Wimbledon to pay winners more; Deutsche bank’s biggest shareholder is Chinese; UK says it won’t pay huge Brexit fee

Profitable Moment

Alitalia’s failure symbolizes Etihad’s too

If James Hogan of Etihad hadn’t already resigned, then he should have done so now, with the news that Alitalia is putting itself up for sale. The government is taking bids on the struggling airline in the next two weeks. 

In 2014, Hogan bought 49% of Alitalia, promising Etihad would turn around the Italian airline. No one is surprised at the turn of events. This isn’t being clever ex post facto. Anyone with any knowledge and experience in aviation said the strategy was doomed ab initio.

Etihad’s partner strategy is in tatters. Air Berlin, in which it also owns 30%, saw losses balloon last year as the umpteenth restructuring took hold. And Etihad has poured hundreds of millions of euros into Air Berlin. Now, Alitalia, on which it has also spent a fortune, has failed.

In short, Etihad’s only partnership successes are with small airlines like Air Serbia and Air Seychelles — both tiny airlines that Etihad could dominate. When it came to big carriers like Air Berlin and Alitalia — let there be no more “emperor’s new clothes" — the results has been abject failure. 


What’s new… what’s next

By Matt Egan, Patrick Gillespie, Julia Horowitz and Paul R. La Monica of CNNMoney

1. U.K. says it won’t pay €100 billion Brexit bill 

The European Union has warned Britain that pulling out of the block will be a painful — and costly — process with real consequences. The EU’s chief negotiator warned U.K. officials this week that the divorce bill could cost €100 billion ($109 billion) upfront. British leaders won’t have any of it, denying that they would pay such a large bill. To be continued…

2. Wimbledon ups prize money to a record high

Wimbledeon has hiked this year’s prize money by 10% — but international players are still likely to see their winnings tumble. The winners of the singles tournament in July will receive 2.2 million pounds each, up from 2 million pounds last year. But the bump doesn’t look as nice once you factor in the decline in value of the pound. Scotland’s Andy Murray need not worry, but those who want to change their prize from pounds to dollars should take note.

3. Food prices skyrocket in Venezuela

Amid political chaos, Venezuelans are losing weight because either there’s a food shortage, or that they can’t afford whatever is available due to skyrocketing prices. Soaring inflation due to the government’s crippling economic policies has created severe shortages of everything from milk and butter to medical equipment and basic medicines. Last year, the average Venezuelan living in extreme poverty lost about 19 pounds (8.7 kg) due to a lack of food. Recently, the government increased the minimum wage by 60%, but that’s not enough to buy even groceries. 

4. Deutsche Bank’s biggest investor: China Inc.

China’s growing global influence is once again on display. HNA Group, a deal-hungry Chinese conglomerate, has overtaken the Qatari royal family as the largest shareholder in Deutsche Bank. Including the $3.7 billion Deutsche Bank investment, HNA has now done more than $30 billion of deals abroad. Last year, HNA bought a stake in Hilton Worldwide and this year it agreed to buy Skybridge Capital from Trump campaign fundraiser Anthony Scaramucci.

5. Puerto Rico files for municipal bankruptcy 

Puerto Rico has filed for bankruptcy — and it’s the biggest municipal filing in U.S. history. Puerto Rico currently owes creditors a whopping $70 billion, which is far higher than Detroit’s $18 billion bankruptcy in 2013. From here, the process is long and messy. A judge must approve the bankruptcy, and many prominent Wall Street firms own Puerto Rico’s bonds. Now, they’re worried they won’t be paid back.

6. Quick Takes:

Fed leaves rates alone, but will it need to start cutting again instead of hiking?

Trump’s tough task ahead: Finding jobs for America’s ‘forgotten people’

Europe’s economy is growing faster than Brexit Britain (For real!)

Chinese tech giant Tencent joins exclusive $300 billion market value club

China’s first big C919 jetliner to make maiden flight from Shanghai Friday

Self-driving Peugeot cars to take test run on streets of Singapore

Apple may go on buying binge with its more than a quarter of a trillion in cash

7. What’s next:

How’s Big Oil doing? The US energy industry is in the spotlight on Thursday morning as several oil-related companies look to replicate Exxon’s surge in profits. Apache, Occidental Petroleum and Chesapeake Energy are all scheduled to report earnings before the opening bell. They will be joined by cereal maker Kellogg and Comedy Central-owner Viacom.

Video games and energy drinks: Earnings season rolls on after the closing bell with quarterly numbers due out from Zynga and Activision Blizzard, the maker of Call of Duty gaming franchise. Results are also expected from CBS, Zillow and energy drink maker Monster Beverage.

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