DealBook Briefing: Can Carlos Ghosn's car survive its downfall?

Business



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The arrest of Mr. Ghosn yesterday could well cause big problems for the three automakers that he oversaw, Nissan, Renault and Mitsubishi.

He has been accused of underestimating his compensation to the Japanese authorities and other violations committed by companies. (According to the Nikkei Asian Review, a subsidiary of Nissan would have bought him $ 17.8 million worth of goods.) "Needless to say, this is an act that can not be tolerated by society," said Hiroto Saikawa, CEO of Nissan, Wednesday.

Nissan and Mitsubishi have announced that they will dismiss him as president, while the French government has announced that Renault is setting up interim leadership.

But Ghosn has been instrumental in overseeing the empire – the world's biggest automaker, if it's considered one company – and it's not clear anyone can keep it.

Stephen Wilmot of Heard in the street explain what could happen instead:

The risk for investors of its loss is that Renault, Nissan and Mitsubishi are once again small but mainstream car manufacturers, just as the unprecedented technological changes make the scale more necessary than ever.

More: The arrest is a warning to the CCEO around the world, said FT's editorial board.

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Today's DealBook deal was written by Andrew Ross Sorkin in New York, and by Michael J. de la Merced and Jamie Condliffe in London.

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The Nasdaq fell 3% yesterday, led by Apple and the semiconductor manufacturers. Facebook, Amazon and Netflix all found themselves in bearish territory, down at least 20% from their peaks reached in September.

Matt Phillips, NYT, draws the numbers: "Apple was worth more than $ 1 trillion in early November. Now it is valued at $ 880 billion. "

Technological investors have something to be bearish. Apple's iPhone sales are in question; Facebook is mired in even more scandal; and the flea makers seem to be on the brink of an accident. Trade tensions do not help either.

But the size of these companies is dropping everyone, as Mr. Phillips notes:

The vast majority of technology companies give them a disproportionate influence on the market, in both directions. The tumult of technology on Monday pushed the major stock indices into negative territory for November, leaving investors hanging on to a gain of less than 1% for the year.

Futures markets following US stocks suggest that the slide could continue today.

Although the British Prime Minister's political allies do not like his plan to leave the EU, he can benefit from the support of the country's companies. She received a warm welcome yesterday at the Confederation of British Industry, a professional group, of business leaders who have relieved by a certainty and rebuffed by the risk of a Brexit without issue.

Benjamin Mueller of the NYT spoke to the public:

"It has put an agreement on the table, which is true for the first time in two-and-a-half years," said Craig Beaumont, Director of External Affairs and Advocacy for the Federation of Small Businesses, who occupied the Director's position. public. "Companies accept that she is in a difficult position, but appreciate her progress."

Some business leaders have doubts: several major financiers, including investor Guy Hands, have publicly supported a "popular vote" to reconsider his decision to leave the EU.

But May's plan may offer more certainty than another possible outcome if it fails: a Brexit led by Jeremy Corbyn, Leader of the Labor Party of the Opposition. The head of the business confederation said that there was no time to renegotiate.

More news about Brexit: A rebellion against Ms. May's leadership in her Conservative party seems to have failed. France and Spain may demand new concessions from Britain. And e-mails show that a major supporter of the pro-Brexit campaign sought to work with Steve Bannon in 2015.

EU. leaders will discuss their future relations with Britain. Officials should explain today how they intend to handle talks on issues such as data protection, security and trade once Britain is gone.

Chinese President Xi Jinping will sign investment agreements in the Philippines. During a state visit to Manila, Xi is expected to begin multi-billion dollar infrastructure projects with his Philippine counterpart, Rodrigo Duterte.

The problem lies largely in the fact that Facebook and Google dominate digital advertising, which reduces the attractiveness of media companies for advertisers. Some start-ups, such as The Athletic and The Information, have turned to the subscription models. But Peretti says that for big companies like his, clubbing could be the way to get bargaining power. And he says he had preliminary talks with some competitors.

Ed Lee, of NYT, notes that big obstacles remain:

Any transaction would be difficult to conclude given the number of investors involved and the cumulative losses that would result from the combination of several young companies in loss of money. Staff reductions would be unavoidable.

More news in the media: Traditional media companies are also struggling, with over a million Americans having cut the cord last quarter.

A new weapon in US trade wars could include blocking the sale of exotic technologies abroad. The Commerce Department yesterday released a request for public comment on whether "there are specific emerging technologies that are important to US national security."

The review lists dozens of technologies, from quantum computing to A.I. technology to brain-computer interfaces and micro-robots, which could be subject to export restrictions. Companies may be required at least to hold a license to export sensitive technologies to "US embargoed countries, including those subject to an arms embargo".

It remains to be seen how far the limits can be extended, but they could affect everything from the sale of supercomputers to devices increasingly powered by I / I, like the iPhone.

"If you think about the range of products that potentially involves, it's huge," said David Edelman, director of the Massachusetts Institute of Technology's Technology, Economy, and National Security Project. "It's either the opening of a big negotiation with the industry and the public, or a call for help in posting this regulation."

Bitcoin dropped below $ 5,000 yesterday; it was valued at nearly $ 20,000 last December. Several factors accelerated its fall:

• Last Thursday, Bitcoin Cash, a spin-off of Bitcoin, suffered a so-called "fork" to become two separate currencies, after the developers could not reach an agreement. This raised concerns about the dilution of cryptocurrencies.

• The regulatory study, which largely contributed to Bitcoin's continued decline this year, still weighs on the industry. Last week, the SEC forced two companies to return the funds raised via initial parts offers because sales were not properly recorded

G.E. rehired John Rice, who retired from the conglomerate last year, as president of his gas power business.

L Brands hired John Mehas Tory Burch as C.E.O. for Victoria's Secret lingerie division.

British bank TSB named Debbie Crosbie, the C.O.O. of his rival CYBG, like his C.E.O.

Goldman Sachs and UBS have been the most active poachers of their rivals' bankers this year, according to Business Insider.

Compass, the new real estate company backed by SoftBank, hired Kristen Ankerbrandt Carlyle Group as its foreign trade fund.

Offers

• As part of Taylor Swift's new recording deal with Universal, the label must donate the proceeds from the sale of its shares in Spotify to its artists. (NYT)

• Saudi Aramco reportedly canceled plans to issue up to $ 40 billion of bonds to fund the takeover of chemical producer Sabic. the air more doubtful than ever.

• Chinese authorities have approved Walt Disney's acquisition of most of 21st Century Fox. (NYT)

• David's Bridal, the retailer of wedding dresses, has filed for bankruptcy protection. (NYT)

• The airline industry in Asia could use some consolidation. (Breakingviews)

• Warburg Pincus would raise up to $ 4 billion for a Chinese investment fund. (Reuters)

Politics and politics

• Sixteen Democrats have signed a public letter against the return of Nancy Pelosi to the presidency of the House. (WaPo)

• The repeal of a popular tax break by the Republicans could have cost them mid-term. (NYT)

• Ivanka Trump repeatedly used personal e-mails for White House issues last year. (WaPo)

• A federal judge prevented the Trump administration from automatically denying asylum to migrants who cross the US-Mexico border illegally. (AP)

• King Salman of Saudi Arabia publicly supported his son and heir, Crown Prince Mohammed bin Salman, who was accused of playing a role in the assassination of Saudi dissident Jamal Khashoggi. (NYT)

• Democratic senators sued to prevent Matt Whitaker from acting as Attorney General. (Politico)

Trade

• Farmers affected by the trade war are expected to benefit from a $ 12 billion aid program, but it is mired in paperwork. (NYT)

• Some potential beneficiaries of this trade war: Malaysia, Japan, Pakistan and other Asian countries. (Bloomberg)

• Nvidia must walk on a fine line as it provides A.I. chips in the United States and China. (WSJ)

• How the Trump administration's sales representative, Bob Lighthizer, is preparing for battle at the Group of 20 meeting next month in Buenos Aires. (FT)

• US companies do not want to leave China yet. (NBCC)

Technology

• What happens to cities that will not have a new big Amazon office? (Result)

• Uber is back in Germany and this time he plays well. (In addition: an overview of the company's self-driving car test before it was involved in a fatal accident.)

• Facebook's profit margin is decreasing, but not only because it represents a significant investment in privacy and security. (Bloomberg)

• Snap's board of directors would find Evan Spiegel focused on the long-term – and his dislike of short-term thinking – a source of frustration. (Information)

• Read some of the arguments that Definers, the P.R. company that Facebook fired last week, sent to technical blogs. (TechCrunch)

Best of the rest

• How a predatory lending industry harms small businesses and makes some officials very rich. (Bloomberg)

• Small European countries attract talent better than the United States (Bloomberg)

• Why equal paid parental leave for mothers and fathers benefits families and employers. (Also: Goldman Sachs fired a 15-year-old veteran while she was on maternity leave.)

• The opioid industry is trying to oppose New York's efforts to make it pay for the drug crisis. (WSJ)

• The bond market makes less sense. (Bloomberg)

• The whistleblower of Danske Bank said that a major European bank had processed $ 150 billion of suspicious payments involved in its money laundering scandal. (Reuters)

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