Fairfax 'starting from scratch' as it eyes growth opportunities: Watsa
After years of expressing bearish views on the economic weaknesses in global markets, Fairfax Financial Holdings Ltd. founder and CEO Prem Watsa is turning to a brighter focus on investment opportunities he sees.
With several years of lacklustre investment returns weighing on the Toronto-based firm, Fairfax is "basically starting from scratch" after removing all its extensive equity hedges at the end of last year, Mr. Watsa told a packed concert hall of shareholders at the Fairfax annual meeting in Toronto on Thursday.
The insurance and investments company is at an inflection point after the unexpected results of the U.S. presidential election altered executives' views of the potential for economic growth and rising corporate profits south of the border. Mr. Watsa said that Fairfax's actions to ease up on its protective hedges and reduce the duration of its fixed income portfolios led to a $1.2-billion (U.S.) net loss on Fairfax's investments in 2016, the company's fourth overall loss in 31 years. Story (Jacqueline Nelson)
Energy bankers branch out into cannabis as legalization approaches
Veteran energy-investment bankers are applying tried-and-true oil patch financing methods to a sector that's not so down on its luck – weed.
Sonny Mottahed, chief executive officer of Calgary-based Black Spruce Merchant Capital, said he and his team are taking a three-pronged approach to their first foray into the cannabis sector as legalization approaches.
The moves come following months of study into what is expected to be an exponentially growing industry in Canada and elsewhere. The outlook for oil and gas has not been so bright as recovery from a two-year downturn has plodded. Story (Jeffrey Jones)
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SNC-Lavalin Group Inc. is buying British-based WS Atkins PLC in a deal worth $3.6-billion, the biggest ever takeover for the Canadian company it pushes into the top tier of engineering firms worldwide. Story (Nicolas Van Praet)
BP Plc is considering the sale of its stakes in three Canadian oil sands projects, people familiar with the matter told Reuters this week, as part of the British oil company's strategy of retreating from noncore businesses. Story
Virtu Financial Inc said it would buy rival KCG Holdings Inc in a $1.4-billion deal that brings together two major U.S. electronic trading and market-making firms. Story (Reuters)
The Trump election was supposed to jump-start new interest in bank mergers. But for one deal, all it has done is create headaches. Story (WSJ, subscription required)
Theresa May's first privatization since becoming prime minister looks like it has just about given Macquarie Group Ltd. the better side of the deal. Story (Bloomberg)
ELSEWHERE IN FINANCE
Home Capital Group Inc.'s shares plunged Thursday, erasing about $300-million in market value, as investors weighed the potential damage from regulatory action against the company, one of Canada's biggest alternative mortgage lenders. Story (Niall McGee)
Wells Fargo & Co's largest investor, Warren Buffett, has likely already voted his shares to support the bank's recommendations at its contentious annual shareholder meeting next week, a representative told Reuters on Wednesday, which include reinstating most of the board's directors. Story (Reuters)