wallstreetjournaleurope_20170111_The_Wall_Street_Journal___Europe

B2| Wednesday, January 11, 2017 THE WALL STREET JOURNAL.

INDEX TO BUSINESSES

These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.

A
Agricultural Bank of
China.........................B
Alphabet................B1,B
Ant Financial Services
Group.........................B
Areva...........................B
Ariad
Pharmaceuticals.......B
AT&T..........................B
B
BMW.........................B
Boeing.........................A
Broadcom....................B
C
China UnionPay...........B
Comcast.....................B
D
Daimler................B2,B
E
European CommissionB
Evercore Partners.....B
Exxon Mobil................A
F
Facebook......................B
Fiat.......................B2,B
Fiat Chrysler

Automobiles.............A

Ford Motor...........B1,B

G

General Motors...B4,B

Google.........................B

Greenhill....................B

H

Hanjin Shipping..........B

HealthPrize

Technologies...........B

I

International Business

Machines...................B

L

Lockheed Martin.........A

L'Oreal.........................B

M

Millennium

Pharmaceuticals.......B

Moelis........................B

N

National Oil.................B

Nycomed......................B

P

Paladin Energy............B

Paysa...........................B

Perrigo.........................B

Planet Labs.................B

Pricewaterhouse

Coopers.....................B

R

Related........................B

Rosneft.......................A

Royal Mail...................B

S

Salix PharmaceuticalsB

Sanpower....................B

Saxo Bank...................B

SkyBridge Capital.......B

Standard Chartered..B

T

Takeda

Pharmaceutical....B2,B

Tencent Holdings........B

Tesla Motors........B2,B

Toyota Motor............B

V

Valeant Pharmaceuticals

International.............B

Volkswagen.................A

W

Waymo........................B

Y

Yahoo................B3,B5,B

YPF..............................B

BUSINESS & FINANCE

New Competitors

Market capitalization of car or mobility companies

*Private companies; based on most recent valuation

Source: FactSet THE WALL STREET JOURNAL.

Alphabet

Toyota

Daimler

Volkswagen

Uber*

BMW

General Motors

Ford

Tesla

Lyft*

$543 billion

190

79

72

63

61

53

48

35

5.

INDEX TO PEOPLE

B-D
Balkrishnan, Rajesh..B
Brandt, Eric.................B
Chabot, Steve.............B
Chubak, Steven.........B
Conaway, Mike............B
Doty, James................B
Duffy, Sean.................B
E-G
Ellis, David..................B
Feehan, Townsend......B
Filo, David...................B
Getty, Jomode Elie.....B

H-K

Haftar, Khalifa............B

Hansen, Gaylen...........B

Hansen, Ole.................B

Hatchett, Jon..............B

Hensarling, Jeb...........B

Kehoe, James..............B

M

Macri, Mauricio...........B

Ma, Jack......................B

Maris, David................B

Massad, Timothy........B

Mayer, Marissa...........B

McInerney, Thomas....B

Mody, Raj....................B

P-S

Papa, Joseph...............B

Porter, Geoff...............B

Raffat, Umer...............B

Sanallah, Mustafa......B

Scaramucci, Anthony..B

T-Y

Towner, John...............B

Toyoda, Akio...............B

Weber, Christophe......B

Yamaguchi, Hidemaru B

But concerns are growing
that Australia is letting pri-
vate investors profit too much
from higher land and property
values generated by the new
transportation projects. Aus-
tralia lags behind places such
as Hong Kong, London and
Denver in the use of mecha-
nisms to ensure private real-
estate developers—not just
the public purse—help to pay
for infrastructure, critics say.
“We’re spending money, but
we’re losing value,” said Joe
Langley, a director in the in-
frastructure advisory unit of
engineering-services firm
AECOM Technology Corp. in
Sydney.

In London, where a new
train line known as Crossrail is
set to be completed in 2019,
authorities charge developers
and businesses various levies
to siphon off some of the rise
in land values. This concept,
called value capture, pays for
a third of the Crossrail project.
Developers in Australia
aren’t saddled with such costs.
In the suburb of Baulkham
Hills, about 30 kilometers
from central Sydney, land val-
ues jumped 82% in the four
years after the A$20 billion
Sydney Metro project was un-
veiled in 2011. Sydney Metro
aims to use rail links to con-
nect outer suburbs with the
central business district.
The price rise outpaced the
57% growth in residential-
property prices in the London
suburb of Shenfield, a similar
distance from the city center,
in the six years since Crossrail
got the go-ahead, real-estate
firm Knight Frank said.
Lawmakers have signaled a
need to change tack. The Aus-
tralian government said in No-
vember that the country is

Continuedfromthepriorpage

nearing the limits of financing

infrastructure projects entirely

with taxpayer money, and

value capture is a possible so-

lution.

Andrew Constance, the

transportation and infrastruc-

ture minister for the state of

New South Wales, Australia’s

most populous, said the gov-

ernment was exploring new

funding options, including

value capture.

Real-estate lobby groups

are preparing to push back.

Urban Taskforce Australia re-

cently said “value capture isn’t

a magic pudding that will fund

all infrastructure,” while the

Property Council of Australia

recently warned lawmakers

against introducing “new taxes

under the cloak of value cap-

ture.”

Some developers think they

can solve the public-funding

dilemma and benefit at the

same time. MTR Corp., which

operates the Hong Kong rail-

way and helped construct Lon-

don’s Crossrail, offers to build

new train lines with private

money in exchange for the

right to develop land near sta-

tions.

Property firms wishing to

build apartment or office tow-

ers would pay a land premium,

with proceeds flowing back

into the railway. MTR has

tested the model in Hong Kong

and Shenzhen.

Last year, Centurion Group

of Cos., representing state-

owned China Railway Engi-

neering Corp., proposed a sim-

ilar value-capture model to

pay for a new, high-speed

train line linking several towns

on Australia’s eastern coast.

Meanwhile, Consolidated

Land & Rail Australia, a con-

sortium backed by former U.S.

Secretary of Transportation

Ray LaHood, is working on a

proposal for a superfast train

between Sydney and Mel-

bourne.

Chairman Nick Cleary said

the project was driven by the

prospect of turning cow pad-

docks into prime property.

“This is a real-estate plan

as opposed to a railway plan,”

said Mr. Cleary, who added

that the consortium already

had secured 50% of the land

needed to build eight cities

along the train line.

BUILD

Some developers

think they can solve

the funding dilemma

and still benefit.

cal factions that the company

wouldn’t pay to reopen facili-

ties but argued instead they

would all lose out if oil reve-

nue didn’t increase soon, ac-

cording to NOC and Western

security officials.

Most militias still receive

wages from the government for

their role in the 2011 uprising

and for securing oil facilities.

Western governments, in-

cluding the U.S., also con-

tacted militia leaders to per-

suade them that it was in their

interest to let the oil flow, ac-

cording to the security offi-

cials.

Jomode Elie Getty, presi-

dent of the Toubou Revolu-

tionary Council, which repre-

sents one of the militias

abroad, said Western govern-

ments persuaded his group to

address its grievances with

Tripoli through legal means

instead of violence.

in recent months has helped

NOC’s bid to jump-start oil

production.

In September, the Libyan

National Army, a militia that

opposes the Tripoli govern-

ment, wrested control of the

oil ports and allowed them to

reopen. The army’s chief, Khal-

ifa Haftar, believed the re-

opening would give him politi-

cal legitimacy and allow him

access to oil revenue needed

to pay his fighters, people fa-

miliar with the matter said.

A spokesman for Gen. Haf-

tar didn’t respond to requests

for comment.

Another deal came together

last month when two militias

that controlled different sec-

tions of Libya’s biggest oil

field agreed to allow National

Oil to pump again.

In talks that spanned seven

months, NOC’s chairman, Mus-

tafa Sanallah, told local politi-

try’s annual export revenue.

“It’s the oil company as a

nation,” said Geoff Porter,

head of North Africa Risk Con-

sulting, who advises oil com-

panies active in the region.

“The real driving force behind

rebuilding Libya as a nation

state is the NOC.”

National Oil once was a tar-

get for militias that wanted to

either control its resources or

deprive rivals of oil revenue.

In 2014, oil storage tanks were

torched in Tripoli and in east-

ern terminals after warring

militias tried to seize control

of the facilities.

As recently as August, NOC

opposed reopening Libya’s

eastern oil ports in exchange

for payments to the militia

controlling them. Company of-

ficials feared the militia would

shut down the ports again af-

ter receiving payment.

Changes in militias’ tactics

Still, the marginal impact on

car sales could be felt this

decade.

Whenever it takes off, car

makers have made clear they

want a part of the mobility

business. Most car makers

have either bought stakes in

startups or launched their

own: General Motors has in-

vested in Lyft, Toyota in

Uber, Volkswagen in Gett.

Oddly, Volkswagen has also

launched a separate ride-

sharing startup. The problem

with this approach is that it

has encouraged a prolifera-

tion of small rivals to Uber,

none with the scale neces-

sary to succeed. Encourag-

ingly, BMW and Mercedes-

owner Daimler are said to be

discussing a merger of their

own carpool businesses, but

this has already run into

problems with a joint-ven-

ture partner.

These deals are partly

about securing access to the

emerging industry’s most

precious resource: data. It is

assumed autonomous vehi-

cles will teach themselves to

drive by learning from vast

amounts of data collected in

real driving conditions. But

the current leader in data

collection isn’t a mobility

provider but probably Alpha-

bet’s Waymo. Electric-vehicle

specialist Tesla has also col-

lected a lot of real driving

data via the data-enabled

cars it sold to consumers.

The only car maker to

have shown enthusiasm for

working as a contract manu-

facturer for Silicon Valley is

Fiat Chrysler , which is sup-

plying vehicles to Waymo.

Chief Executive Sergio Mar-

chionne, who regularly calls

for industry consolidation, is

betting that working with a

tech giant in a subordinate

role is better than having

power over a minnow.

The auto industry is roll-

ing in profits from near-re-

cord sales and low gas

prices, which make lucrative

SUVs more attractive. Yet in-

vestors are staying away and

stock valuations are dismal.

The rise of electric cars

and then the arrival of self-

driving vehicles will bring in

new, well-financed competi-

tors to the auto industry. It

will also transform a cyclical,

capital-intensive manufactur-

ing business into a more sta-

ble service provider with im-

mense potential for adver-

tising. The irony is that, after

the upheaval, investors could

value the winners in this

race much more highly than

they do the current industry

leaders.

would also undermine the

stable system of car dealer-

ships that has controlled the

industry for decades.

Another much analyzed

question concerns just how

many cars will be purchased

for shared ownership. New

York fund manager ARK esti-

mates that cheap autono-

mous taxis could eventually

halve the number of cars

bought in Europe and North

America every year. Other

projections are more benign:

UBS expects a maximum hit

to new car sales of 3% to 5%.

There will be fewer cars on

the road, but they will be

driven much more so the re-

placement cycle will be

faster.

Tech-industry bulls such

as ARK believe self-driving

technology will be ready in

2019. Car-industry types tend
      to be much more cautious.
      But the reality is likely to be
      more complex than a single
      date: Autonomous technol-
      ogy is likely to be introduced
      soonest in restricted urban
      areas before spreading to
      freeways and—perhaps many
      years later—the countryside.

Continuedfromthepriorpage

HEARD

duction agreement.

Nigeria, an OPEC member

that was exempted from cut-

ting, increased its output by

200,000 barrels a day in De-

cember.

Some analysts have ques-

tioned Iraq’s commitment to

cutting output after The Wall

Street Journal reported the

country’s plans to increase ex-

ports in January.

Still, Libyan output looms

largest over OPEC.

Libya’s National Oil remains

one of the last functioning in-

stitutions left in the country

and has become stronger in

recent weeks. Its 61,000 em-

ployees make it the largest

Libyan company by far, and it

accounts for 95% of the coun-

Continuedfromthepriorpage

LIBYA

way to allow or refuse cookies.”

But the proposals may

prompt companies to display

pop-ups asking users to switch

their settings to allow tracking

before they can continue using

the services.

“People who thought cookie

banners were annoying will be

disappointed to hear that

things won’t get better,” Ms.

Feehan said.

The EU’s rules come at a

timewhen the digital ad indus-

try is growing in Europe. Last

year, digital ad spending

reached around $35 billion and

is set to grow to $45 billion by

2020, according to market-re-

search firm eMarketer. While it

is unclear how much of that rev-

enue comes from targeted on-

line ads, if a significant number

of users opt out of those pre-

Continuedfromthepriorpage

mium ads, it could hit the bot-

tom line for big online ad bro-

kers like Google and Facebook.

Companies that don’t com-

ply could be fined as much as

4% of the firm’s world-wide

revenue, the EU said.

In a minor victory for the in-

dustry, the commission wa-

tered down parts of the pro-

posal from a previous draft

that would have defaulted the

user’s settings to reject the

tracking if a choice wasn’t

made when prompted.

That move has irked some

consumer and privacy advo-

cates.

The commission’s proposal

“is an improvement over what

we have now but it is clearly not

as good as a ‘do not track’ set-

ting turned on by default,” said

Johannes Kleis, head of commu-

nications at BEUC, the European

Consumer Organization.

Tuesday’s proposal would re-

place a directive, which provides

guidelines to member states on

how they should implement

rules, with a regulation that

would be applied the same way

in all 28 member states.

—Sam Schechner

contributed to this article.

Big Spending

Companies are spending an increasing share of their advertising

budgets in Europe on digital ads.

$

0

10

20

30

40

billion

2011 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19 ’

Projections Projections

50

0

10

20

30

40

%

2011 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19’

Digital ad spending Percentage of total media

ad spending

Source: eMarketer Inc. THE WALL STREET JOURNAL.

EU

Co. CEO joined Valeant in May

to help restore battered inves-

tor confidence.

Valeant’s stock has col-

lapsed since late 2015, when

an accounting issue raised

questions about its earnings

and spurred a crisis of confi-

dence in management. The

company’s backers have con-

sistently argued the stock

market has ignored the value

of the underlying businesses,

while its detractors have fo-

cused on the company’s debt

and slumping earnings.

The stock was ahead 6.6%

at $16.37 Tuesday afternoon,

but it is still down 82% over

the past 12 months and well

below its all-time high above

$260 set in August 2015.

Valeant’s deal announce-

ments eased concerns that the

company would have to sell

assets at fire-sale prices. It

purchased CeraVe in 2008 for

$95 million and bought Den-

dreon out of bankruptcy in

2015 for about $500 million.

“Some good news finally,”

Evercore analyst Umer Raffat

headlined his note on the

sales, saying the reduction in

revenue would mostly be off-

set by the lower debt pay-

ments.

In a Tuesday note, Wells

Fargo & Co. analyst David

Maris that the proceeds from

the sales wouldn’t fully cover

the $3.8 billion in debt Valeant

has coming due by the end of

2018.

Valeant has put a number

of assets on the auction block

but has struggled to strike

deals at acceptable prices. It

came close but ultimately

failed to seal a deal to sell

stomach-drug maker Salix

Pharmaceuticals Ltd. to

Japan’s Takeda Pharmaceuti-

cal Co. for $10 billion. It is

also exploring a sale of its

Bausch & Lomb surgical equip-

ment business, which could

fetch $2.5 billion, people fa-

miliar with the matter have

said.

Dendreon is known for pros-

tate-cancer treatment

Provenge. The acquisition was

Valeant’s first big transaction

after losing a hostile bid in

2014 for Botox maker Allergan,

which went instead to Actavis

PLC for about $67 billion.

Valeant wasn’t a big player

in cancer treatments, and

Provenge proved a disappoint-

ing fit. Provenge had $

million in sales the year before

the acquisition; it isn’t clear

what revenue has been more

recently.

—Nick Kostov

contributed to this article.

Valeant Pharmaceuticals

International Inc. reached

deals to sell $2.1 billion in as-

sets, the struggling drug com-

pany’s biggest moves yet to

regroup around its consumer

offerings and pare its heavy

debt load.

The Canadian company

agreed to sell three skin-care

brands, including its CeraVe

line, to French cosmetics giant

L’Oréal SA for $1.3 billion. It

also said it would sell its Den-

dreon cancer business to Chi-

nese conglomerate Sanpower

for $820 million.

The asset sales are part of

Valeant Chief Executive Jo-

seph Papa’s efforts to

sharpen the company’s focus

on its key franchises in skin

drugs, stomach treatments,

eye care and consumer health

while selling noncore assets

to pay down its roughly $

billion in debt.

Mr. Papa was set to speak

later Tuesday at an investor

conference in San Francisco,

with analysts expecting to

hear updates on his vision for

Valeant. The former Perrigo

By Dana Mattioli ,

David Benoit and

Jonathan D. Rockoff

Valeant Sheds $2.1 Billion in Assets

CEO JosephPapa joined Valeant in May to boost investor confidence.

CHRISTINNE MUSCHI/REUTERS

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