Deal of the Century?
UBS' Acquisition of Credit Suisse
Short, subscriber-only comment on UBS today. Post-summer programming resumes next week. Have a good (long) weekend — Marc.
In his book, Zero to One, Peter Thiel introduces a useful heuristic on competitive positioning. “Both monopolists and competitors are incentivised to bend the truth,” he writes. His argument is that the more dominant a firm’s position in a market, the more its executives are keen to downplay it so as to avoid undue scrutiny. “Since they very much want their monopoly profits to continue unmolested,” he goes on, monopolists “tend to do whatever they can to conceal their monopoly – usually by exaggerating the power of their (nonexistent) competition.” By contrast, it’s only companies operating in extremely competitive environments that boast they are in a league of their own.
I got thinking about this as I tuned into the UBS earnings call this week. UBS completed its acquisition of Credit Suisse on June 12 and this call was management’s first opportunity to update th…