McKinsey's bribery case and its subsequent $122mn payment to authorities in the US and South Africa over its role in a corruption scandal during the administration of former South African president Jacob Zuma has raised significant eyebrows. This incident serves as a stark reminder of the importance of ethical conduct in the business world. Thames Water's bid from Covalis Capital and France's Suez's potential involvement in managing the break-up of the UK's largest water utility before its stock market listing also adds another layer of complexity to the dealmaking landscape. In this article, we will explore these and other dealmaking trends in detail.

Uncovering the Underbelly of Dealmaking and Its Implications

McKinsey's Bribery Scandal: A Wake-Up Call for Corporate Ethics

McKinsey's agreement to pay a hefty sum due to its involvement in a corruption scandal is a matter of great concern. Such actions not only damage the reputation of the firm but also have wider implications for the business community. It highlights the need for stricter regulations and oversight to prevent such unethical practices. The case serves as a reminder that companies must prioritize integrity and compliance in their operations.In the past, there have been instances where companies have faced similar consequences for engaging in corrupt activities. These incidents have led to increased scrutiny and a demand for greater transparency. McKinsey's situation is no exception, and it is likely to set a precedent for other firms to follow. The fallout from this scandal will be closely watched by the business world and regulatory authorities alike.

Thames Water's Bid and the Future of UK Water Utilities

Thames Water's bid from Covalis Capital and France's Suez's potential involvement in managing the break-up of the UK's largest water utility before its stock market listing is a significant development. This deal has the potential to reshape the UK water industry and bring about changes in the way these utilities are managed.The involvement of an international player like Suez brings with it expertise and resources that could help improve the efficiency and sustainability of Thames Water. However, it also raises questions about the impact on local communities and the environment. The process of breaking up a large utility and listing it on the stock market is a complex one that requires careful consideration of various factors.There have been similar cases in other countries where the privatization of water utilities has led to both positive and negative outcomes. It will be interesting to see how Thames Water's bid unfolds and what lessons can be learned from similar experiences.

Private Equity's €19bn Forever Bet: Visma's Long-Term Growth Story

In 2006, the private equity group Hg acquired a small Oslo-listed software company called Visma at a valuation of about $500mn. Fast forward nearly two decades, and Visma has grown to become one of Europe's largest software companies with a valuation of €19bn.This remarkable growth story is a testament to the power of private equity and the long-term vision of investors like Hg. By facilitating private valuation stake sales roughly every three years, Hg has been able to transfer the company between its own funds and bring in outside investors, allowing existing shareholders to sell.This unique approach has enabled Visma to build up its value over an exceptionally long timeframe. The company's recent private sale of some shares to new investors at a €19bn valuation is a further indication of its success. It shows that with the right strategy and patience, private equity can drive significant growth and create value for shareholders.

Anti-Woke Fund's First Prey: Starbucks and the Changing Investment Landscape

Standing next to Donald Trump at Mar-a-Lago, James Fishback is preparing to launch an "anti-woke" ETF that will exclude companies in the S&P 500 that factor diversity, equity, and inclusion into their hiring. His first target is Starbucks, which has drawn attention due to the alleged outdated DEI policies.This move by Azoria Partners highlights the changing investment landscape and the growing influence of political and social factors in the market. While the firm may not have the financial heft to directly influence Starbucks' decisions, it sends a signal to other companies and investors.There have been similar cases in the past where activist investors have targeted companies for their DEI policies. The success or failure of such initiatives will depend on various factors, including public opinion and the company's response. It remains to be seen how this anti-woke fund will fare and what impact it will have on the broader investment community.

Mid-to-Little Bank M&A Boom: Opportunities and Challenges

Donald Trump's new antitrust chief nomination has raised concerns among dealmakers hoping for a boom in M&A. While the US banking sector is bracing for a new era of consolidation, particularly among smaller lenders, there are also caveats and obstacles.Investors and advisers anticipate a wave of M&A that could help regional and community banks remain competitive against Wall Street's giants. However, cultural and community ties often act as a barrier to selling for smaller banks. The recent acquisition of Bremer Financial by Old National Bancorp is an example of a deal in the making, but it also highlights the challenges faced by smaller banks in a changing regulatory environment.Bob Diamond predicts a significant reduction in the number of US banks over the next two to three years. While there are opportunities for consolidation, it remains to be seen how the market will evolve and which banks will emerge as winners.

Job Moves in the Financial Industry

HSBC's head of global private banking and wealth, Annabel Spring, is leaving at the end of the year. Her role will be split between Gabriel Castello and Lavanya Chari. This leadership change is likely to have an impact on HSBC's global private banking operations.Eldridge Industries is launching an asset management and insurance holding company with approximately $74bn in assets under management. This move shows the continued growth and diversification of the financial industry.At Citigroup, Cary Kochman, head of global mergers and acquisitions, is retiring, and Kevin Cox will take on the role in an interim capacity. These job moves highlight the dynamic nature of the financial industry and the importance of leadership succession.

Smart Reads and News Round-up

After the killing of a UnitedHealth executive in New York, companies are rushing to reassess the protection they provide to top executives. This incident serves as a reminder of the need for enhanced security measures in the corporate world.A big Middle Eastern bank trading in Paris is embroiled in controversy for allegedly concealing critical information from the French regulator. Such cases highlight the importance of transparency and compliance in the banking industry.Denmark's offshore wind giant Ørsted, once seen as a model for how oil and gas majors could go green, is facing challenges. Things don't seem to be going as smoothly as planned, highlighting the complexities of the transition to a greener economy.There are also various news round-ups including US court rejects Boeing's Max plea deal over company's DEI policies, Marc Andreessen helps to recruit staff for Elon Musk's US cost-cutting body, how the £16.5bn Vodafone-Three UK merger will reshape Britain's mobile landscape, UK pensions lifeboat wipes £283bn off defined benefit funding estimates, public pension plans and wealth funds to invest more in private markets, and large payments did not raise "red flags", says Trafigura finance chief, and regulators sign off on new global rules for insurers and Shell and Equinor to combine UK offshore oil and gas assets.These developments highlight the diverse and ever-changing nature of the business and financial world. It is important for stakeholders to stay informed and adapt to these changes.