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Goldman Sachs Hires Crypto Guru; Sears’ CEO Bids To Buy Company Assets; Old Navy Bucks Trends

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The Water Coolest

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THE HEADLINES

Estimated Read Time: 3 minutes and 38 seconds

 

BLOODS AND CRYPTS

Goldman Sachs is hiring Justin Schmidt as their VP of Digital Currencies. Prior to accepting the offer Schmidt worked for quantitative analysis firms Seven Eight Capital LLC and WorldQuant LLC. F*cking nerd.

At the behest of clients, Goldman has been a leader in the banking industry, as one of the first financial institutions to clear (facilitate the exchange of ownership) crypto transactions.

Having one of the biggest banks in the world bullish on the industry is a welcome sign for the crypto players.This ain’t just for black market Bulgarian scammer types anymore. 

Water Cooler Talking Point: “I wonder if the new CEO is signing off on all these moves? Of course, we aren’t sure how big the crypto portfolio is going to be, but we do know that Lloyd probably doesn’t give a f*ck about going all in. Retirement is the best.”

 

SEAR-IOUS INQUIRIES ONLY

Define Hail Mary: when a CEO offers to buy part of his ailing business.

Eddie Lampert, the CEO of Sears is pitching a plan so crazy that it just might work. Lampert has approached Sears’ board, presumably via intraoffice memo, about purchasing the Kenmore brand and Sears’ Home Improvement and Parts Direct businesses via his hedge fund, ESL Investments.

Financial terms weren’t disclosed but estimates put the value of the Kenmore brand at $500M. The move isn’t without controversy and Crazy Eddie’s (seriously, that’s his nickname) motives are open to interpretation. Theories include Lampert …

  • Stripping the company of it’s remaining valuable assets for his personal gain
  • Providing a much-needed cash influx to help pay down Sears’ debt
  • Hoping to kickstart a bidding war that will attract other buyers

The struggling retailer’s future prospects appear to be eroding as it is currently staring down $1B in debt that comes due this year.

Water Cooler Talking Point: “Keeping Sears on life support just seems cruel and unusual at this point. Their brick and mortar outlets look like an IED went off in your local hardware store’s clearance section.”

 

WHAT’S OLD IS NEW AGAIN

In a day and age where most retailers are shuttering retail outlets, Old Navy is pressing on full steam ahead and opening 60 new stores this year. So many graphic tees and two-dollar sandals to be had.

Gap, Old Navy’s parent company, will close 200 of their Gap and Banana Republic locations by 2020. But Old Navy stores are doing so well that Gap plans to remodel 150 locations in the next few months, with 10% of those stores receiving full makeovers. Talk about playing favorites. 

Old Navy and Athleta have been bright spots in Gap’s portfolio in recent years. As the main catalyst for growth, same-store sales at Old Navy rose 9% this past quarter.

Water Cooler Talking Point: “I wasn’t aware that Old Navy was good for anything other than buying official July 4th grilling dad uniforms: the original 2004 Old Navy American Flag t-shirt paired with white New Balances.”

 

IN OTHER NEWS

 

  • The good news? Google’s parent, Alphabet, reported earnings and beat profit and revenue expectations. The bad news? The company is bleeding cash in its hardware division.
  • Netflix will raise $1.5B in debt financing to further expand its pool of original content. Because how else could the media giant afford Seth Rogen?
  • A Humana-led group will buy hospice operator Curo Health Services for $1.4B.
  • Thanks a lot, Jeffrey. Hasbro attributes its 16% drop in sales for the first quarter to Toys R Us’ closing.
  • The former CEO of Mt. Gox, the failed bitcoin exchange, will return as an executive at London Trust Media despite still being on trial for embezzlement. This move just screams: “we don’t do background checks!”
  • The European Commission announces an in-depth investigation into Apple’s Shazam deal. Apparently, the antitrust regulators in the EU are pretty, pretty bored.
  • US indices were mixed yesterday:
    • DOW: -0.06%
    • S&P 500: +0.01%
    • NASDAQ: -0.25%