Business review from the Economist
Softbank's Son calls WeWork bet a mistake
Masayoshi Son, the chief executive of SoftBank, acknowledged that he made a mistake by betting on WeWork, as his group revealed a $4.6 billion write-down of its investment in the office-rental startup. Overall, SoftBank reported a quarterly net loss of 700 billion yen ($6.4 billion)—"red ink of the deepest red," said an unusually contrite Son. The Japanese conglomerate had to rescue WeWork after it abandoned an IPO amid questions about its valuation and a shortage of cash. Son is now taking steps to beef up oversight of SoftBank's many interests, such as demanding at least one seat on the board of any firm it sinks money into.
Part of SoftBank's loss was also connected to its investment in Uber. The ride-hailing company reported another quarterly loss, of $1.2 billion, and said it did not expect to turn an annual profit until 2021. Its share price tumbled to another record low, in part because of expectations that Uber's shares will flood the market now that investors who were locked in to holding them after the company's IPO in May are free to sell.
The Federal Communications Commission formally approved the long-delayed merger of Sprint, which is owned by SoftBank, and T-Mobile, Deutsche Telekom's American subsidiary. A lawsuit brought by a coalition of states attempting to block the deal on antitrust grounds is scheduled to be heard in court next month.
HP confirmed that it had received a proposal from Xerox to combine their businesses. A deal would reportedly be valued at around $30 billion.
The U.S. and China were making progress in trade negotiations, with each considering a reduction in tariffs. The conclusion of "phase one" of a trade truce is uncertain because of civil unrest in Chile, which has canceled the APEC meeting where the deal was to be signed. Meanwhile, the World Trade Organization gave China official approval for the first time to impose tariffs on the United States in a dispute over steel predating their current spat.
Steve Easterbrook was fired by McDonald's as its chief executive for having a romance with an employee. Although the relationship was consensual, McDonald's said it "violated company policy and demonstrated poor judgment." Easterbrook has been credited with revitalizing the fast-food chain by spicing up its menu. Its share price has doubled since March 2015, when he became CEO.
International Airlines Group, the parent company of several carriers, including British Airways and Iberia, agreed to buy Air Europa, a smaller Spanish rival to Iberia. The deal will increase IAG's share of the Europe-to-Latin America market from roughly a fifth to a quarter. Michael O'Leary, the boss of Ryanair, Europe's biggest low-cost airline, said the takeover will hurt competition and wants regulators to force IAG to sell off some assets.
Chesapeake Energy warned in a filing that it was in danger of failing as a "going concern" if cheap gas prices persist. The company has amassed almost $10 billion in debt, five times its market value, amid a glut in U.S. oil and gas output.
Global politics from the Economist
More MPs exit British Parliament
As the British general election campaign got underway a stream of members of Parliament announced they would not stand again. So far, more than 70 have stepped down — more than twice the number who chose not to face the electorate in 2017. More than 60 of those supported to remain, and most represented constituencies that voted for Brexit. The Conservatives' campaign got off to a bad start, with the resignation of a Cabinet minister. Polls still give them a double-digit lead over Labour.
Colombia's defense minister said he would resign amid accusations that the army has committed atrocities.
A drug gang killed nine members of a Mormon family in Sonora, a state in northern Mexico. Six children and three women died in the ambush. It is unclear whether the killers mistook them for rivals or whether they were the intended targets of the attack. The LeBaron family broke away from the mainstream Mormon church and settled in Mexico in the early 20th century. The victims were dual U.S.-Mexican citizens.
Iran took another step away from the nuclear deal that it signed in 2015 by injecting gas into centrifuges at its Fordow facility. The devices could produce enriched uranium to be used for nuclear energy or, if highly enriched, a bomb.
Deadly smog engulfed much of northern India, thanks in part to farmers burning stubble and to revelers letting off firecrackers to celebrate Diwali, a Hindu holiday.
An attack on a checkpoint in southern Thailand killed 15 people; it was the worst in the region for years.