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Dec 11, 2019

DealBook: Saudi Aramco’s Share Price Soars in I.P.O.

12-15 minutos - Source: NYT




Credit.../EPA, via Shutterstock

Aramco shares jump in world’s largest market debut
Shares of Saudi Aramco, the world’s largest oil company, surged 10 percent within seconds of their market debut, reports the NYT’s Stanley Reed.
The initial public offering is expected to raise at least $25.6 billion, making it the largest ever.
The state-owned company faced headwinds on its journey to the public markets, which started about three years ago when Crown Prince Mohammed bin Salman said he wanted to sell a stake in an effort to wean the Saudi economy off its dependence on oil and government spending.
The Saudi government shifted its strategy, turning to local and regional buyers, limiting the number of shares offered, and downgrading the role of Wall Street banks.
The successful debut has helped Aramco reach a valuation of $1.88 trillion, surpassing Apple as the world’s biggest listed company, Bloomberg reports. And it helped the kingdom’s bourse become the world’s ninth-biggest stock market, even though barely any of Aramco’s shares will trade.
It’s no secret that racism has been baked into the American banking system. There are few black executives in the upper echelons of most institutions, and research has shown that black mortgage borrowers are charged higher interest rates than whites.
Financial institutions have said they are working to diversify their ranks and are committed to eradicating the legacy of racism. Yet events at a cluster of JPMorgan Chase branches in Arizona last fall show discrimination is alive in the industry, the NYT’s Emily Flitter writes.
“You’re bigger than the average person, period. And you’re also an African-American,” a bank employee, who is black, told the customer, a former N.F.L. player who had been told he would receive the coveted private client designation and had gotten a runaround instead.
That statement is among several on audio recordings made by that customer, Jimmy Kennedy, and another employee, a former financial adviser with JPMorgan in the Phoenix area. They shared those recordings with the NYT, providing unusual evidence of their experiences.
Mr. Kennedy was told he was essentially too black. His financial adviser, Ricardo Peters, who is also African-American, complained that he, too, was a victim of racial discrimination.
Patricia Wexler, a JPMorgan spokeswoman, denied that the bank had discriminated against Mr. Peters or Mr. Kennedy. She said that the bank hadn’t been aware of the audio recordings and that “in light of some new information brought to us by The New York Times,” the company put one of its executive directors, Frank Venniro, on administrative leave. He resigned last week.
Britain’s halting march toward Brexit has prompted two changes of prime minister, two general elections — including one tomorrow — and a paralysis in Parliament as the debate over leaving the E.U. has overwhelmed everything else.
Yet away from the political cut and thrust, Brexit has brought a new level of uncertainty for many of the people who go to work each day in Britain, putting lives and livelihoods in the balance, write the NYT’s Amie Tsang and Adam Satariano. Few jobs have been untouched.
Workers talked about their experiences, including a dairy farmer who cannot plan for the future because the price paid for his milk has been held hostage; a customs broker cautiously preparing for a big expansion of business, but fearful of making wrong call; and two building cleaners whose livelihood has been rocked by outsourcing and dread the loss of job protections.
George Baker, the customs broker, says he knows what it’s like to be at the mercy of political events: “I think probably I’ve got the collywobbles a bit about this whole thing because I’ve been through it.”
Related: In the weeks leading up to the general election, voters have had a taste of what the dark arts of online campaigning have to offer. The pound’s rally will be limited even if Boris Johnson wins a parliamentary majority in the general election and passes the withdrawal bill by Jan. 31. And the U.K. economy unexpectedly stagnated in October, marking three straight months without growth for the first time since 2009.
The White House and House Democrats have reached an agreement to strengthen labor, environmental, pharmaceutical and enforcement provisions in President Trump’s North American trade pact.
It’s a significant development that makes it all but certain that the signature trade deal will become law, the NYT’s Emily Cochrane and Ana Swanson write.
The revision to the United States-Mexico-Canada Agreement, as it is known, was announced yesterday by Speaker Nancy Pelosi after months of negotiations, giving Mr. Trump one of his biggest legislative victories less than an hour after she unveiled articles of impeachment.
“We’re declaring victory for the American worker,” Ms. Pelosi said. “It is infinitely better than what was initially proposed by the administration.” Robert E. Lighthizer, Mr. Trump’s top trade adviser, called the announcement a victory for Mr. Trump. “We have created a deal that will benefit American workers, farmers and ranchers for years to come,” he said.
Political posturing aside, the new agreement is expected to usher in tangible benefits for agriculture, technology, manufacturing and other business sectors, the WSJ writes. Industry analysts say that farmers are likely to see more exports, and more auto parts are expected to be made in the U.S.
Related: It’s an outbreak of bipartisan cooperation in Washington, but don’t expect it to last.
The Trump administration is sending mixed signals on delaying new tariffs on more than $100 billion of Chinese goods before they take effect on Sunday, report the NYT’s Ana Swanson, Alan Rappeport and Keith Bradsher.
American officials have hinted that President Trump could pause the tariffs as the U.S. and China continue haggling over a trade deal.
But no decision had been made, and the president could go either way, the reporters write:
• “The two sides remain divided over how many of Mr. Trump’s tariffs will be canceled in return for China’s trade concessions, and over the terms that will govern Chinese purchases of tens of billions of dollars of American agricultural products.”
“We’re still in a high-stakes poker game,” said Myron Brilliant, the executive vice president of the U.S. Chamber of Commerce.
Chinese officials expect Mr. Trump to delay the tariff increase, which would allow more time to reach an interim trade deal as talks drag on, Bloomberg reports.
More: As the trade war takes its toll, Brazil is set to overtake the U.S. as the largest soybean producer in the world. And Larry Kudlow, Mr. Trump’s top economic adviser, said no decision had been made on reinstating tariffs on steel from Argentina and Brazil.
Ray Dalio, the billionaire investor and founder of Bridgewater Associates, revealed his new protégé on Twitter: the hip-hop mogul Sean Combs, Bloomberg reports.
“The greatest joy I’m having now is helping other people to be successful,” Mr. Dalio posted in his introduction of the rapper-turned-entrepreneur known as Diddy.
The two explored techniques aimed at business success, including “radical open mindedness,” in a 25-minute video of a recent mentoring session that was posted on YouTube.
Find the best talent to build a team, Mr. Dalio tells Mr. Diddy: “Don’t let yourself be the guy who is going to undertake this mission and undertake that mission.”
Bradley Singer, the chief operating officer at the activist investor ValueAct, is stepping down as a nonexecutive director at Rolls-Royce after nearly four years. (FT)
Lindsay Page is leaving as chief executive at the clothing retailer Ted Baker after less than a year on the job. (FT)
Maurice Saatchi, a co-founder of M&C Saatchi, and three independent directors quit the advertising company in a dispute over how to address accounting problems. (Bloomberg)
Bunge, the agriculture products company, named Bernardo Hess, a 3G Capital partner and a former Kraft Heinz C.E.O., to its board. (News release)
Deals
• Dairy farmers are wary of a possible merger between the largest dairy co-op in the U.S. and Dean Foods, a milk processing company that sought bankruptcy protection last month. (NYT)
• The Justice Department will review plans by Alphabet to buy Fitbit. (Reuters)
• New York Life is negotiating with Cigna to acquire a unit that sells life, accident and disability-income insurance to employers. (WSJ)
• Bill Ackman’s hedge fund disclosed a 2.9 million-share stake in the laboratory instrument and software company Agilent Technologies. (WSJ)
• Just Eat has rejected a fresh attempt by South Africa’s Naspers to disrupt the food delivery group’s planned tie-up with Takeaway.com. (FT)
• The end to the traditional I.P.O.? Venture capitalists and bankers say that almost every tech company pursuing a public offering is considering a direct listing. (CNBC)
Politics and policy
• The Fed is expected to leave interest rates unchanged at its final meeting of the year today, as officials wait to see how the economy fares after they cut interest rates three times in 2019. (NYT)
• Senator Elizabeth Warren is taking on Pete Buttigieg and Michael Bloomberg, while emphasizing her gender as the top woman left in the Democratic presidential race. (NYT)
• Mick Mulvaney, the acting White House chief of staff, has summoned President Trump’s top two health policy officials to assess whether they can continue to work together. (NYT)
• House Democrats are making a last-ditch bid to reverse the $10,000 cap on state and local tax deductions before year’s end. (Bloomberg)
• Wiping out medical and student loans might sound radical — but in fact, its roots lie in ancient Babylon. (Bloomberg)
• A New York State judge handed Exxon Mobil a victory yesterday in a case brought by the state’s attorney general over how the company said it accounted for the costs of climate change regulation. (NYT)
Impeachment
• House Democrats announced yesterday that they would move ahead this week with two articles of impeachment that charge President Trump with abuse of power and obstruction of Congress. (NYT)
• A last-minute debate over how broad a case to bring against the president reflects the competing demands on Democrats from within their own party and their determination to appear as unified as possible. (NYT)
Tech
• Facebook executives sparred with Attorney General William Barr over whether encrypted messaging products should be open to law enforcement, escalating a standoff over privacy and policing. (NYT)
• Intel became the first company to release the results of a report it sent to the Equal Employment Opportunity Commission that gives pay, race and gender data for about 51,000 U.S. workers. The results are not flattering. (Bloomberg)
• Giant tech stocks have posted a remarkable year, shrugging off the trade war, bipartisan political hostility and regulatory threats. (NYT)
• Loon, a unit of Google’s parent, Alphabet, that uses high-altitude balloons to provide mobile internet to remote areas, has signed an airspace access agreement with Uganda. (Reuters)
• A tech company that developed a Christmas dinner in a can for “hardcore gamers” has updated the meal with vegetarian and vegan options. (NYPost)
Best of the rest
• Chevron is writing down the value of its assets by more than $10 billion, as the world grapples with an overabundance of oil and gas. (WSJ)
• Apprenticeships in health care, financial services, software development and even law are offering an alternative to paying college tuition. (NYT)
• With uneven conflict-of-interest rules and murky influence peddling, the E.U.’s $65 billion in farm subsidies are kept flowing by the people who benefit. (NYT)
• As banks are pulling back from lending, wealthy families are offering direct loans in return for high yields. (Bloomberg)
• Fannie Mae and Freddie Mac are pulling back on some mortgages meant to make homeownership more affordable, their latest effort to rein in risk at the behest of their regulator. (WSJ)
• The biggest American banks have buoyed hopes of a big rebound in fourth-quarter earnings. (FT)
• The London Stock Exchange is considering proposals for a shorter trading day. (Bloomberg)
• Morgan Stanley was fined 20 million euros, or $22.2 million, by France’s market regulator over European bond trades. (FT)

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