DealBook Briefing: Surprisingly, Female C.E.O.s May Make as Much as Male Ones

Good Tuesday morning. Breaking: Didi Chuxing has reportedly begun talking with bankers about an I.P.O. this year that could value the company at more than $70 billion. On the earnings calendar: Coca-Cola, Caterpillar and Verizon. Some links require subscriptions.

There may not be a pay gap between female and male C.E.O.s

That stunning conclusion, from a new study, could shake up discussions in boardrooms and C-suites everywhere. (The study tracked compensation at 2,282 companies from 1996 to 2014.)

More from Andrew’s column:

Important caveat: The new study isn’t a sign that the overall gender pay gap in corporate America has improved, or that there’s been a rush of women appointed as C.E.O.s. “There is still discrimination against women getting to the top,” Sandra Mortal, one of the study’s authors, told Andrew.


Today’s DealBook Briefing was written by Andrew Ross Sorkin in New York, and Michael J. de la Merced and Amie Tsang in London.


Behind Eddie Lampert’s latest move at Sears

What Mr. Lampert’s ESL has proposed doing: buying the beleaguered retail chain’s Kenmore brand, home-services and appliance-parts units and more of its real estate.

ESL’s argument: Buyers offering “acceptable” prices for the businesses haven’t emerged, and Sears needs the cash for its self-help plan. Mr. Lampert, chairman and C.E.O. of Sears, would recuse himself from any board discussions over the bids, and a majority of Sears’s non-ESL shareholders would have to approve any plan.

Critics’ argument: Mr. Lampert is trying to keep Sears’s best assets for himself if the company files for bankruptcy protection, a fate most of the retail world think is a given. “He has been taking productive assets out of the company since Day 1,” Mark Cohen, a former Sears executive, told the NYT.

Sears is burning through more than $1 billion of cash a year and its sales continue to decline.

The deals flyaround

• Newell Brands finally settled with Starboard Value by changing out three of its directors. (Newell)

• Elliott Management has raised its stake in the software company MicroFocus to 5.1 percent as it presses for a shake-up. (Bloomberg)

• CenterPoint Energy plans to buy another electric utility, Vectren, for about $6 billion. (WSJ)

• Humana, TPG Capital and Welsh, Carson, Anderson & Stowe agreed to buy the hospice operator Curo Health Services for about $1.4 billion. (WSJ)

• Henry Schein plans to sell off its animal health business to Vets First Choice through Michael’s favorite tax-free deal maneuver, the Reverse Morris Trust. (CNBC)

How much would a wage rise hit Amazon’s profits?

What might happen to Amazon’s bottom line if it paid its workers (median compensation: $28,466) more? If labor markets continue to tighten, the question soon won’t be hypothetical.

Since Amazon doesn’t disclose its total compensation expense, Peter Eavis did some math. Multiplying that median pay number by the total number of employees gives a (hypothetical!) comp expense of $16.1 billion. Two more sums:

• Bumping up median pay by 10 percent would have reduced 2017 pretax income by 42 percent, to $2.2 billion.

• A 20 percent increase would have reduced pretax income by 85 percent.

By comparison, a 10 percent raise at Walmart would have cut annual pretax profit by 28 percent, and a 20 percent raise is a 56 percent hit.

The political flyaround

• The Treasury Department suggested that it might ease sanctions on Rusal if Oleg Deripaska sold his stake. Robert Mueller took Paul Manafort’s testimony about Mr. Deripaska during a raid on the former Trump campaign official’s house last summer.

• Some lawmakers say they will resist any move by the Trump administration to withdraw from Nafta if Congress doesn’t approve a renegotiated version. (WSJ)

• Worsening deficits may force Greenwich, Conn., to raise taxes on its friendly local hedge funds. (FT)

• A quiet federal excise cut has led to a boom in self-investment by craft distilleries. (NYT)

• How Conduent, which runs food stamp networks in 25 states, is blocking Propel, a start-up that lets users check what’s left in their accounts. (NYT)

• Finland is ending its basic-income experiment. (Guardian)

How Sean Hannity quietly became a real estate mini-mogul

When the Fox News host said that he spoke with Michael Cohen because the lawyer knows “real estate,” it turns out that Mr. Hannity had a reason to ask. He has been linked to shell companies that spent at least $90 million on homes in seven states — and benefited from financial programs run by the Department of Housing and Urban Development, according to The Guardian. (Mr. Hannity hasn’t mentioned that when H.U.D. Secretary Ben Carson has been on his show.)

Mr. Hannity’s response: The article was “fake news,” and he didn’t pick the properties the shell companies invested in. (The Guardian reported that Mr. Hannity had signed documents related to the H.U.D. agreements.)

Alphabet is preparing for life after advertising

Sure, Google is the most powerful force in digital advertising. But its parent company’s latest financial results suggest that it’s plowing headlong into potential new businesses. Capital expenditures tripled year-over-year, to $7.7 billion.

Alphabet is currently sitting on some $11 billion worth of start-up investments. (What may be its latest: a $2 billion investment alongside SoftBank in the Chinese truck-hailing company Manbang.)

Privacy corner: Google’s C.E.O., Sundar Pichai, played down the potential impact of forthcoming European data privacy regulations. He may be right to, since incumbents like Google and Facebook already enjoy consumer trust and can better afford compliance with new rules.

Critics’ corner: Alphabet is following Amazon and asking investors to trust in the billions that it’s spending on potential new businesses — and deserves the benefit of the doubt for now, Shia Ovide of Gadfly writes. Investors are getting squishy performance metrics, not concrete ones, Robert Cyran of Breakingviews writes.

The tech flyaround

• Facebook has published its 25-page guide for community standards, which it uses to determine which content to remove. YouTube said that machines flagged most of the videos it removed.

• The European Commission has opened an investigation into Apple’s $400 million bid for Shazam, citing concerns about access to data from competitors like Spotify. (NYT)

• Andreessen Horowitz plans to create a cryptocurrency fund. Energy-guzzling Bitcoin mining is falling out of favor in northern New York.

• The U.S. is reportedly considering sanctioning Kaspersky Lab, the Russian cybersecurity company. (CyberScoop)

• Amazon is reportedly working on a domestic robot, code-named Vesta. (Bloomberg)

• Ferrari has been quietly working on — gasp! — a hybrid car. (Bloomberg)

Your Sohn Investment Conference roundup

Andrew was on hand to introduce some investors, including Bill Gurley of Benchmark and Chamath Palihapitiya of Social Capital. Here were the top picks:

• Jeff Gundlach of DoubleLine: Bet on commodities and against Facebook.

• Mr. Gurley: Bet on Amazon and Tesla’s bonds, not its stock. Bet against Hertz (thanks, Uber) and SoFi.

• Mr. Palihapitiya: Bet on Box.

• Larry Robbins of Glenview Capital Management: Bet on McKesson and CVS, because Amazon isn’t coming for pharmacy benefits.

• Li Ran of Half Sky Capital: Bet on GrubHub, because millennials (except for us) can’t cook.

Revolving door

• United Continental is looking for a new chairman after Robert Milton decided to step down. (Its C.E.O., Oscar Munoz, will also see his pay cut after a very bad 2017, P.R.-wise.) (WSJ)

• Goldman Sachs has hired Justin Schmidt, a cryptocurrency trader from Seven Eight Capital, as its head of digital market assets, even if it isn’t setting up a cryptocurrency trading desk (yet). It has also moved Mazen Makarem from Dubai to New York to cover private equity firms and sovereign wealth funds.

• Evercore has hired Wilco Faessen from Barclays as a senior managing director and co-head of its global consumer and retail group. The investment bank has also hired Bill Thompson from Greenhill & Company as a senior managing director and co-C.E.O. of its private capital advisory team.

• Dangote Cement, which is owned by Africa’s richest man, Aliko Dangote, has named two new directors: Mick Davis, the former C.E.O. of Xstrata, and Cherie Blair. It also made Joseph Makoju permanent C.E.O. (Bloomberg)

• ComScore has named Bryan Wiener, one of its directors, as C.E.O. (WSJ)

The speed read

• Richard Jenrette, who helped found what became the investment bank D.L.J., died on Sunday at 89. (NYT)

• Deutsche Bank is reportedly considering extensive cuts to its U.S. cash equities business. (Bloomberg)

• Clean energy is becoming mainstream with the help of windmills the size of jumbo jets. (NYT)

• Halliburton has written off its remaining $312 million investment in Venezuela as oil production continues to plummet. (NYT)

• Vanguard is laying groundwork for expansion in China. (Bloomberg)

• Shares in WPP fell after Ford said it might move some of its advertising accounts elsewhere. (CNBC)

• Wells Fargo and G.E. are facing calls to end their decades-old audit relationships with KPMG. (FT)

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