The escalating trade war between Washington and Beijing dominated discussions at the G-7 gathering in France.Politicsread more
The latest round of tariff announcements in the last few days means that by the end of the year, essentially all Chinese goods exported to the U.S. will be subject to duties.China Economyread more
Futures fell after Trump said the U.S. will raise tariffs on more than $500 billion worth of Chinese imports, increasing trade tensions.Marketsread more
As Washington and Beijing continue to up the ante in their protracted trade fight, the potential of a recession in the U.S. is now "the biggest concern," according to Standard...US Economyread more
Tensions stemming from the U.S.-China trade war escalated sharply over the last few days, with much happening as Asian markets were shut down for the weekend.China Economyread more
Clouding the G-7 gathering, which represents the world's major industrial economies, are the tit-for-tat tariffs between Washington and Beijing.Politicsread more
Neither the U.S. nor China wants to be seen as the party that derailed trade talks, says William Reinsch of Center for Strategic and International Studies.World Economyread more
China said Friday it will be resuming 25% duties on U.S. autos, and a further 5% on auto parts and components.Asia Marketsread more
World leaders, environmental groups and celebrities have publicly decried the vast swaths of forest being destroyed by the fires.World Newsread more
Education Minister Ong Ye Kung says the Singapore government has been preparing for the challenge of an aging workforce "for the past 20 years."Employmentread more
Megvii is known for its facial recognition technology and while revenue grew over 350% in 2018, its losses have widened.Technologyread more
Anadarko's board said Monday a revised $38 billion offer from Occidental was superior to its existing $33 billion agreement with Chevron. Now, Chevron has until Friday to counter Occidental's bid for Anadarko, an international driller with enviable assets in U.S. shale fields, the Gulf of Mexico and Africa.
There's no doubt the San Ramon, California-based energy giant can afford to put more chips on the table. But Chevron CEO Michael Wirth told analysts last month he won't overpay. He said his company has a strong case to present to investors whether or not he closes the deal with Anadarko.
The question is whether it makes more sense for Chevron to fold and pocket a $1 billion breakup fee. At least one investment bank thinks the drama is over.
Stifel believes Chevron will walk away from the deal and look for another acquisition target in the Permian Basin, the top U.S. shale field underlying Texas and New Mexico. Chevron also wanted Anadarko's liquefied natural gas development in Mozambique, but not badly enough to put up a fight, according to Stifel analyst Michael Scialla.
"While CVX had overlap with APC's Permian assets and could easily manage the Mozambique project, the company is unlikely to stretch for this transaction, in our view, as long as cheaper alternatives ... are available," Scialla said in a research note Monday.
KeyBanc analyst Leo Mariani thinks Chevron will make at least one counteroffer, probably bidding at least $70 per share. At that price, Chevron would tack another $3.2 billion onto its overall proposal, he says.
Chevron also has a built-in $2.50 per share advantage because Anadarko would not have to pay the $1 billion breakup fee, Mariani notes. In his view, Chevron also has more currency because it would emerge from the deal with less debt than Occidental.
Still, the $70 per share offer might not be enough to beat Occidental's $76 per share bid, Mariani says.
Mizuho Securities also anticipates a counteroffer because "Chevron has some major structural reasons to want Anadarko." That would cause Occidental to raise its own bid, but from there, thinks things could get interesting, according to Mizuho's lead oil analyst, Paul Sankey.
Occidental is mostly focused on Anadarko's Permian assets, while Chevron has its eye on a bigger part of the portfolio. Sankey speculates that Chevron could waive the $1 billion breakup fee in exchange for a major asset swap with Occidental.
Most investors expect Chevron to put in just one more bid — and one that matches Occidental's offer to pay 78% cash and 22% stock for Anadarko, says Morgan Stanley. The Chevron-Anadarko transaction is structured as a 25% cash and 75% stock deal.
Once Chevron puts in its bid, Morgan Stanley thinks Occidental his limited room to maneuver. Raising its bid much further would raise concerns that it is taking on too much borrowed capital.