HAVE A HAPPY DAY, GOLDMAN SACHS!
In addition to yesterday’s brutal torching in the Financial Times (highlights reprised—too good to give only single coverage!), Goldman Sachs has the dubious pleasure of seeing their name plastered all over the financial and mainstream press (the latter includes USA Today and The New York Times).
The focus is relentlessly on their botching of the World Online IPO and their role in the PetroChina IPO, i.e., their complicity in financing oil-driven destruction in Sudan. Their violation of US securities laws governing communications about the prospective PetroChina issue also gets nice coverage.
All in all, a wonderfully appropriate day of infamy and bad press.
Eric Reeves [April 21, 2000]
Smith College ereeves@sophia.smith.edu
Northampton, MA 01063
413-585-3326
*************************************************
Financial Times (London)
April 20, 2000, Thursday London Edition 3
HEADLINE: FRONT PAGE – COMPANIES & MARKETS: Goldman Sachs may face advisory bar
By Paul Abrahams and Gillian Tett (Tokyo)
***Japan’s ministry of finance is considering barring Goldman Sachs, the US investment bank, from advising it on privatisations***—notably the next sale of government shares in NTT, Japan’s dominant telecoms group.
The ministry has become ***increasingly alarmed about Goldman’s management*** of some recent international share issues.
A ban would be a blow to Goldman’s franchise in Japan, where it has been aggressively building up its operations. It has the highest profile and is the most successful of western investment banks in Tokyo.
****************
***”There have been four or five initial public offerings where Goldman Sachs has been the adviser and the best that can be said is that there was a lack of judgment involved,” said a senior official at Japan’s ministry of finance.***
***It is highly unusual for government clients of leading investment banks to allow any concerns that they might have to become public. The MoF’s worries are likely to prove a severe embarrassment to Goldman.***
[***NB***] Among recent international deals involving Goldman that have aroused questions are ****PetroChina****, one of China’s largest offerings, which had to be scaled back from an initial $10bn to $3bn and faced heavy criticism over the company’s investments in *****Sudan****** during a roadshow in the US.
*****************************************************
Here the headlines say it all:
[1] Business Week, Monday, April 24, 2000 [Number 3678]
Finance: DEALS
SUDDENLY, GOLDMAN IS LESS GOLDEN
After brokering a string of troubled deals, the firm is facing criticism
from investors
By David Fairlamb in Frankfurt
[2] USA TODAY, April 21, 2000, [SECTION: MONEY; Pg. 2B]
Japan’s blow stings Goldman Officials criticize bank’s handling of European IPOs
BY: Thor Valdmanis
NEW YORK — Goldman Sachs shares sank 3.5% Thursday after the ***Japanese government took the unusual step of publicly slamming the Wall Street investment bank for its management of some recent international share issues.***
[3] The New York Times, April 21, 2000, Friday
Business/Financial Desk
GOLDMAN MAY BE BARRED
BYLINE: Bloomberg News
The No. 1 underwriter of Asian stocks in the first quarter, the Goldman Sachs Group, may be disqualified from arranging Nippon Telegraph and Telephone’s planned $13 billion share sale because of a soured stock offering in Europe last month.
******************************************************
South China Morning Post, Friday, April 21, 2000
Top Japan official threatens privatisation ban for investment bank
Goldman fights back
CATHY HOLCOMBE
Goldman Sachs has defended its deal-making record after a senior
Japanese official threatened yesterday to bar the United States
investment bank from potentially lucrative privatisations.
***Ministry of Finance director Satsuki Katayama said Goldman would be
disqualified from bidding for privatisations should it be censured for
its role in the controversial World Online initial public offering (IPO)
in the Netherlands.*** [UGLY!!]
*****************************************************
Agence France-Presse, Thursday, April 20, 2000
Japan may bar Goldman Sachs from lucrative NTT share offer by Shino Yuasa
TOKYO, April 20 (AFP) – US investment banking giant ***Goldman Sachs
Thursday was facing a ban from a lucrative Japanese government share
deal over its role in disgraced Dutch Internet company World Online’s
flotation.*** [UGLIER!!!—see below]
***
***”The fact that the MoF (finance ministry) said this publicly is
just unbelievable,” said an industry insider who declined to be
named.***
****”It’s going to be a big deal and a huge blow for Goldman Sachs if they get banned from this share coordinating (role) in the world’s second biggest economy.”**** [OUCH!!!]
A stockbroker who also declined to be named agreed that any
ministry sanctions against Goldman Sachs would be “a huge blow to the
company since the NTT deal involves a hefty amount of money.”
“And this could create a precedent for ***Goldman Sachs that they may
not be able to underwrite for big customers” in Japan***, he added.
[HEY! THIS **IS** THE WORLD’S SECOND LARGEST ECONOMY!! JUST WHAT WILL THIS DO TO GOLDMAN SACHS’ BOTTOM LINE??—And given their role in the PetroChina/China National Petroleum IPO, they deserve every bit of the opprobrium and bottom-line savaging that they get—ER.]