LONDON (Reuters Breakingviews) - Marco Polo brought the idea of paper money to Venice when he returned from China towards the end of the 13th century. Now, it’s Chinese tourists that are bringing money into all of Italy. The number of visitors from the Middle Kingdom rose 31% between May and August compared with a year before, according to information from travel data analysts ForwardKeys. That was the fastest growth of any country out of Asia. The sudden popularity has less to do with a rash of interest in Renaissance painting and more to do with politics.
LONDON (Reuters Breakingviews) - Western luxury is binge-eating humble pie. In the last few days, storied brands - including Swarovski, Versace and Givenchy - have submitted grovelling apologies for offending Chinese sensibilities. With Hong Kong protests against the mainland getting worse, it’s the thin end of a potentially very awkward wedge.
LONDON (Reuters Breakingviews) - Takeaway.com’s Just Eat offer looks undercooked. The 4.7 billion euro Dutch food-delivery group, led by founder Jitse Groen, has struck an all-share deal to buy its British peer with its highly valued stock. He may nonetheless have to come up with a more enticing platter to tempt Just Eat shareholders.
NEW YORK/LONDON (Reuters Breakingviews) - Beyond Meat is on fire. The meatless-burger maker reported first-quarter numbers only a hair better than it already estimated yet the stock, which had already quadrupled since its initial public offering a month ago, surged more than 15% in after-hours trading on Thursday, bringing its valuation to a whopping $6.8 billion.
LONDON (Reuters Breakingviews) - The jury is out on whether there is any money to be made ferrying hot meals to time-poor urbanites. Amazon’s investment in loss-making Deliveroo, which operates in 500 European and Asian cities, defers the answer. It also means investors’ bellies will remain empty for the foreseeable future.
HONG KONG (Reuters Breakingviews) - Uber Technologies has recipes to avoid food delivery indigestion. The U.S. ride-hailing giant hopes a $795 billion global takeout market can offset slowing growth in its core business. Established rivals like Europe’s Takeaway.com suggest there are ingredients to aid success.
LONDON, SAN FRANCISCO (Reuters Breakingviews) - Uber Technologies’ $3.1 billion acquisition of Middle East rival Careem Networks should give its IPO a boost. It shows the group which is burning cash is still willing to spend to grow. And, by reducing competition in the fast-growing region, it gives potential investors one less thing to worry about.
LONDON (Reuters Breakingviews) - Europe risks sacrificing its antitrust principles at the altar of global competitiveness. That’s a dangerous precedent, particularly since would-be partners Siemens and Alstom are hardly desperate for a deal.
LONDON (Reuters Breakingviews) - Cracks are showing in the $97 billion Vision Fund. That undermines the idea of SoftBank boss Masayoshi Son as a tech sage, and makes life harder for his dealmakers.
MILAN/LONDON (Reuters Breakingviews) - Remo Ruffini could be Italy’s answer to Bernard Arnault in 2019. Since rescuing Moncler in 2003, the entrepreneur has rejuvenated the brand into a goose-down success story. There’s a long way to go before he can use the growing strength of 7.5 billion euro Moncler to create anything like Arnault’s LVMH, worth 130 billion euros. But if he fancies building the first Italian luxury aggregator, now is a good time. Italian luxury is fragmented and valuations are historically cheap — the sector trades on 25 times expected earnings, compared to a five-year average of 28 times, Refinitiv data shows. Sales at upscale shoemaker Tod’s have been falling since 2014. Salvatore Ferragamo also struggles with revenue, and is in flux after matriarch Wanda Ferragamo’s death. Unlisted players like handbag-maker Furla may also come up for sale. U.S. and Chinese buyers have noticed. Michael Kors paid a hefty $2.1 billion for struggling Versace in September. China’s top textile player Shandong Ruyi and conglomerate Fosun snagged Swiss brand Bally and French couture house Lanvin respectively. Still, the rise of an EU-sceptic government in Rome embracing shaky budget policies could put a brake on global buyer enthusiasm. That gives Ruffini an opportunity to consider going beyond Moncler. The Italian is doing something right: sales jumped by 15 percent in 2017 and should do so again in 2018. His skills could be deployed to battle the generational shifts and changing consumer habits undermining some storied Italian brands. Investors who bought Moncler shares when it debuted in 2013 have seen total returns double, beating all listed peers bar Hermes. At 35 percent, Moncler’s EBITDA margins are second only to the famed French handbag maker among luxury players in Europe. And Ruffini is no stranger to M&A: in October his family vehicle Archive bought a 49 percent stake in small Italian fashion brand Attico. LVMH and peers Kering and Richemont are so shaped because their size brings economies of scale and diversification benefits. Although Moncler’s flagship jackets are in vogue, acquiring leather goods or watches could hedge against fickle tastes. If Ruffini can overcome Italian luxury’s traditional rivalries and get second-generation potential sellers onside, the path to Arnault-style status could be his.