Ex-Goldman Trader Sentenced to 9 Months in Prison

A federal judge in Manhattan on Friday sentenced Matthew Taylor, a former Goldman Sachs trader, to nine months in prison for covering up an $8.3 billion unauthorized trade at the firm.

In 2012, the Commodity Futures Trading Commission accused Mr. Taylor of hiding the trade to protect his year-end bonus of $1.5 million. Prosecutors said Mr. Taylor acted out of “greed and pride” and had sought a sentence of 33 to 41 months. Mr. Taylor’s trade cost Goldman $118 million, a figure he has been ordered to repay.

Mr. Taylor, who once earned seven figures on Wall Street, now cleans pools six days a week in Florida. Dressed in a dark suit and blue tie, Mr. Taylor apologized to the court, his wife, his two children and even Goldman for his conduct, adding that it was “painful beyond words” to be the source of his loved ones’ distress.

Mr. Taylor, who graduated from the Massachusetts Institute of Technology, owned a home in the Hamptons by the time he was 28.

“In short, Mr. Taylor, you were, in the words of Tom Wolfe, ‘a master of the universe,” the judge, William H. Pauley III, said.

The C.F.T.C. accused Mr. Taylor, who traded equity derivatives products in New York, of hiding the $8.3 billion position he had taken in electronic futures contracts tied to the Standard & Poor’s 500-stock index. Though his superiors had ordered him to reduce the risk on his trading book, he instead ratcheted up the position. To conceal the size of the position, he entered “multiple false entries” into a Goldman trading system, booking trades that he never actually made.

Goldman fired Mr. Taylor after learning about his cover-up and reported the unauthorized trades to authorities within days. The C.F.T.C. did not bring charges against Mr. Taylor until five years later, during which time he was able to get another job as a trader with Morgan Stanley.

Mr. Taylor left Morgan Stanley during the summer of 2012 and pleaded guilty to wire fraud earlier this year.

“This case presents a paradigm of everything that is wrong with Wall Street and the regulators that are charged with protecting the public,” the judge said. “So much for Goldman’s concern about the financial markets.”

Goldman said in a email statement that it notified the Financial Industry Regulatory Authority, the brokerage industry’s policing arm, about Mr. Taylor’s dismissal and made clear “that he was fired for misconduct related to ‘inappropriately large proprietary futures positions in a firm trading account.’”

In August, Mr. Taylor agreed to pay a $500,000 fine in a civil matter related to the criminal case. He had earlier been forced to to give up $3 million in deferred compensation when Goldman fired him.

Mr. Taylor is the second Wall Street trader to receive prison time in less than a month. In November, Kareem Serageldin, a former trader at Credit Suisse, was ordered to serve two and a half years for inflating the value of mortgage bonds as the housing market collapsed.

“Mr. Taylor accepts the judgment of the court,” Thomas C. Rotko, a lawyer for Mr. Taylor, told reporters outside of the courtroom. “We are pleased that the judge saw this matter as we did as an indictment in part of the regulatory system itself.”

Weekend Reading: Giving Credit for the Volcker Rule

Financial regulators are expected to approve a version of the Volcker Rule next Tuesday that is more powerful than Republicans and Wall Street lobbyists would have liked. Jamie Dimon, the chief of JPMorgan Chase and one of the most outspoken critics of the rule, deserves some of the credit for its passage.

“Paul Volcker by his own admission has said he doesn’t understand capital markets,” Mr. Dimon told Fox Business last year. “He has proven that to me.”

That was less than three months before JPMorgan’s $6 billion London trading loss fueled a round of Schadenfreude among supporters of tighter industry regulation. “It plays into the hands of a bunch of pundits,” Mr. Dimon acknowledged when the loss was disclosed.

The year after the London trading loss, JPMorgan spun off its last remaining private equity unit. The decision was said to reflect an emphasis on client businesses over making investments.

A look back on our reporting of the past week’s highs and lows in finance.

FRIDAY, DEC. 6

Sears to Spin Off Lands’ End | The spinoff of the company would follow Sears’s sale of another business, Sears Home and Outlet Stores. DealBook »

THURSDAY, DEC. 5

In the Murky World of Bitcoin, Fraud Is Quicker Than the Law | Government authorities do not agree on which laws apply to Bitcoin â€" or even on what Bitcoin is. DealBook »

Investors, Dismayed by Losses at Sears, Pull Money From Hedge Fund | The storied investing empire of Edward S. Lampert is shrinking. DealBook »

Lively Debate on Proxy Firms’ Influence | The Securities and Exchange Commission hosted a round-table discussion that examined the influence of proxy advisers, potential conflicts of interest, and the transparency and accuracy of their recommendations. DealBook »

SAC Witness Concedes Omission on Illicit Data | Jon Horvath conceded that he never explicitly told Michael S. Steinberg that data he had obtained about Dell was illicit insider information. DealBook »

WEDNESDAY, DEC. 4

Europe Sets Big Fines In Settling Libor Case | Demonstrating a new resolve to punish bank misconduct, the European Union fined a group of global financial institutions a combined $2.3 billion. DealBook »

Treasury Chief to Declare Big Gains in Financial Reform | The broad policy speech is intended to signal the administration’s views on financial regulations. DealBook »

Top Witness in SAC Case Can’t Recall Some Points | Jon Horvath struggled to recall how he came to learn that a friend, who was an analyst at another hedge fund, was passing on illegal inside information about Dell Inc. DealBook »

Wall Street Challenges Overseas Swaps Rules | Banking trade groups filed a lawsuit that challenges new guidelines put in place recently by the Commodity Futures Trading Commission. DealBook »

TUESDAY, DEC. 3

Rule Named for Volcker Approaches Completion | Five federal agencies plan to approve a tougher-than-expected version of the rule next week, providing Wall Street with some much-sought clarity. DealBook »

Unexpected Apology Stokes Embers of a Feud | A dispute over ratings Sean Egan’s company gave Richard B. Handler’s bank in 2012 may have subsided, but the two men are no closer to seeing eye to eye. DealBook »

Trader’s Defense Lawyer Challenges the Recollections of a Crucial Witness | Jon Horvath was unable to recall when he created a document titled “Jon’s trading rules” and when he wrote some of the rules for himself. DealBook »

Deal Professor: Battling in Gray Areas of Law in a Bid to Control a Rival | In his effort to acquire LightSquared in bankruptcy court, Charles Ergen has taken advantage of every gray area in the law, writes Steven M. Davidoff. DealBook »

MONDAY, DEC. 2

A Second Act in Hedge Funds for a Top Wall Street Banker | J. Tomilson Hill, a well-known Wall Street deal maker in the 1980s, has reinvented himself by applying his deal-making skills to the Blackstone Group. DealBook »

New York Subpoenas Websites in an Effort to Curb Payday Lenders | Government authorities are trying to choke off the supply of borrowers to online lenders that offer short-term loans with annual interest rates of more than 400 percent. DealBook »

Goldman and JPMorgan Satisfy Fed With Capital Plans | Goldman Sachs and JPMorgan Chase have finally overcome a regulatory rebuke that had been hanging over both banks since the Federal Reserve performed stress tests this year on large financial firms. DealBook »

Witness Recounts Pressure From Trader for More Data | “Nice job on Dell,” Steven A. Cohen, SAC’s billionaire founder, wrote in an email to Michael S. Steinberg and Jon Horvath in the summer of 2008. DealBook »

SUNDAY, DEC. 1

Quiet Boss at Citigroup Setting Tone for Wall St. | Flying under the radar appears to be just fine with Michael L. Corbat â€" and with the financial giant he has run since October 2012. DealBook »

WEEK IN VERSE

Southern Man | If Neil Young and Lynyrd Skynyrd could eventually get along, surely Sean Egan and Richard B. Handler can come together. YouTube »

Weekend Reading: Giving Credit for the Volcker Rule

Financial regulators are expected to approve a version of the Volcker Rule next Tuesday that is more powerful than Republicans and Wall Street lobbyists would have liked. Jamie Dimon, the chief of JPMorgan Chase and one of the most outspoken critics of the rule, deserves some of the credit for its passage.

“Paul Volcker by his own admission has said he doesn’t understand capital markets,” Mr. Dimon told Fox Business last year. “He has proven that to me.”

That was less than three months before JPMorgan’s $6 billion London trading loss fueled a round of Schadenfreude among supporters of tighter industry regulation. “It plays into the hands of a bunch of pundits,” Mr. Dimon acknowledged when the loss was disclosed.

The year after the London trading loss, JPMorgan spun off its last remaining private equity unit. The decision was said to reflect an emphasis on client businesses over making investments.

A look back on our reporting of the past week’s highs and lows in finance.

FRIDAY, DEC. 6

Sears to Spin Off Lands’ End | The spinoff of the company would follow Sears’s sale of another business, Sears Home and Outlet Stores. DealBook »

THURSDAY, DEC. 5

In the Murky World of Bitcoin, Fraud Is Quicker Than the Law | Government authorities do not agree on which laws apply to Bitcoin â€" or even on what Bitcoin is. DealBook »

Investors, Dismayed by Losses at Sears, Pull Money From Hedge Fund | The storied investing empire of Edward S. Lampert is shrinking. DealBook »

Lively Debate on Proxy Firms’ Influence | The Securities and Exchange Commission hosted a round-table discussion that examined the influence of proxy advisers, potential conflicts of interest, and the transparency and accuracy of their recommendations. DealBook »

SAC Witness Concedes Omission on Illicit Data | Jon Horvath conceded that he never explicitly told Michael S. Steinberg that data he had obtained about Dell was illicit insider information. DealBook »

WEDNESDAY, DEC. 4

Europe Sets Big Fines In Settling Libor Case | Demonstrating a new resolve to punish bank misconduct, the European Union fined a group of global financial institutions a combined $2.3 billion. DealBook »

Treasury Chief to Declare Big Gains in Financial Reform | The broad policy speech is intended to signal the administration’s views on financial regulations. DealBook »

Top Witness in SAC Case Can’t Recall Some Points | Jon Horvath struggled to recall how he came to learn that a friend, who was an analyst at another hedge fund, was passing on illegal inside information about Dell Inc. DealBook »

Wall Street Challenges Overseas Swaps Rules | Banking trade groups filed a lawsuit that challenges new guidelines put in place recently by the Commodity Futures Trading Commission. DealBook »

TUESDAY, DEC. 3

Rule Named for Volcker Approaches Completion | Five federal agencies plan to approve a tougher-than-expected version of the rule next week, providing Wall Street with some much-sought clarity. DealBook »

Unexpected Apology Stokes Embers of a Feud | A dispute over ratings Sean Egan’s company gave Richard B. Handler’s bank in 2012 may have subsided, but the two men are no closer to seeing eye to eye. DealBook »

Trader’s Defense Lawyer Challenges the Recollections of a Crucial Witness | Jon Horvath was unable to recall when he created a document titled “Jon’s trading rules” and when he wrote some of the rules for himself. DealBook »

Deal Professor: Battling in Gray Areas of Law in a Bid to Control a Rival | In his effort to acquire LightSquared in bankruptcy court, Charles Ergen has taken advantage of every gray area in the law, writes Steven M. Davidoff. DealBook »

MONDAY, DEC. 2

A Second Act in Hedge Funds for a Top Wall Street Banker | J. Tomilson Hill, a well-known Wall Street deal maker in the 1980s, has reinvented himself by applying his deal-making skills to the Blackstone Group. DealBook »

New York Subpoenas Websites in an Effort to Curb Payday Lenders | Government authorities are trying to choke off the supply of borrowers to online lenders that offer short-term loans with annual interest rates of more than 400 percent. DealBook »

Goldman and JPMorgan Satisfy Fed With Capital Plans | Goldman Sachs and JPMorgan Chase have finally overcome a regulatory rebuke that had been hanging over both banks since the Federal Reserve performed stress tests this year on large financial firms. DealBook »

Witness Recounts Pressure From Trader for More Data | “Nice job on Dell,” Steven A. Cohen, SAC’s billionaire founder, wrote in an email to Michael S. Steinberg and Jon Horvath in the summer of 2008. DealBook »

SUNDAY, DEC. 1

Quiet Boss at Citigroup Setting Tone for Wall St. | Flying under the radar appears to be just fine with Michael L. Corbat â€" and with the financial giant he has run since October 2012. DealBook »

WEEK IN VERSE

Southern Man | If Neil Young and Lynyrd Skynyrd could eventually get along, surely Sean Egan and Richard B. Handler can come together. YouTube »

A Commodity Business in Name and Prospects

Deutsche Bank’s decision to ditch commodities portends just how commoditized the business may be. The German lender is quitting energy, agriculture, base metals and dry bulk trading. That should free up capital without hurting results. And while it ought to ease the pain from a deep swoon in commodities, profits remain elusive for almost all banks involved.

The end of a boom, as China and other emerging markets reduce consumption, has had serious consequences. In 2007, the top 10 banks took in about $15 billion of revenue, the consultant Ethan Ravage estimated at the time. Last year, according to the research firm Coalition, the top line for all players was just $7 billion.

Banks also have to set aside additional capital these days. New Basel III rules will require even more of a buffer for certain commodities assets. That makes it harder to spin straw - not to mention aluminum, coal, sugar and other goods - into gold. Morgan Stanley has one of the biggest businesses on Wall Street, yet the unit’s return on equity is below 5 percent, according to its chief executive, James Gorman.

Few have found a suitable answer. Morgan Stanley has been investigating selling all or parts of its business to nonbanks. JPMorgan has put its physical commodities business up for sale. Judging by one metric, though, costs have not come down anywhere near as much as revenue. Headcount is pretty much the same as in 2007, Coalition says, and down just 18 percent from its peak in mid-2010.

About 200 jobs are expected to go at Deutsche Bank. It is also finally quitting businesses that even its bigger rivals can’t seem to make worthwhile. Metals trading, for example, accounts for average revenue of just $75 million a quarter at JPMorgan. That requires 140,000 trades, a reminder that only the largest middlemen can compete in some markets.

Other banks struggling in certain areas of commodities, like Barclays and BNP Paribas, may want to follow suit. Selective withdrawals, though, won’t necessarily help the bottom line much.

Deutsche Bank, for example, is keeping commodity derivatives, yet the notional value of over-the-counter contracts plummeted to $2.5 trillion in June from $9 trillion in 2007, according to the Bank for International Settlements. That essentially means that while Deutsche Bank’s move is a good start, it’s far from the end of the contraction in commodities.

Antony Currie is an associate editor at Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.

Credit Suisse Highlights Its Break Dancer Who Strips

Big banks occasionally like to highlight their employees’ achievements, including career milestones, charity work or even running a marathon.

But one bank, Credit Suisse, has given a shout-out to a more unusual activity: break dancing.

In a magazine published by Credit Suisse for its staff, one article in the latest issue highlights Michael Tshiyoyo, a 32-year-old human resources employee in the Geneva office of the Swiss bank. In break dancing circles, he’s known as Easyman.

The article describes how Mr. Tshiyoyo “caught the b-boy bug” as a child, devoting himself to learning the moves. He has become so skilled at spinning, flipping and doing headstands that he competes “against the international elite at least once a year,” he tells the magazine.

Mr. Tshiyoyo has gained accolades for one move in particular, the jackhammer, in which he spins while balancing on one hand, his body low to the ground, the article says. Mr. Tshiyoyo reportedly has added a signature flourish.

“Michael’s innovation? He seamlessly takes off his shirt and pants while spinning,” the article originally read. (That line was quietly removed from the website on Friday.)

While it’s no big secret that bank employees have outside interests, banks are not always happy when these traits become public. One Goldman Sachs worker who pursued a passion for rapping while employed at the firm got a chilly reception from his superiors when word got to the media.

A Morgan Stanley employee was once the subject of a Wall Street Journal article describing how he would approach strangers on the subway and try to befriend them. He was fired soon after, according to the newspaper.

The Credit Suisse break dancer, though, appears in a media outlet run by his employer. “The publication aims to be informative, comprehensible, relevant, and entertaining,” according to the About Us section of the magazine’s website.

The articles contained in the magazine “show the human face of Credit Suisse, and provide readers with an insight into worlds they might otherwise never see,” the website says.

The publication is geared toward employees in the private banking and wealth management division of the bank, but the current issue is available to the public online. Among the articles is an interview with the bank’s chairman and another about employees volunteering with a nonprofit group.

A spokesman for Credit Suisse, Thomas Baer, said every issue of the magazine features a couple of employees. “Normally, those are people with interesting hobbies. We do a story about them and also publish the story online,” he said.

A tip of the hat goes to Sarah Butcher of eFinancialCareers for writing earlier about the Credit Suisse article.

Credit Suisse Highlights Its Break Dancer Who Strips

Big banks occasionally like to highlight their employees’ achievements, including career milestones, charity work or even running a marathon.

But one bank, Credit Suisse, has given a shout-out to a more unusual activity: break dancing.

In a magazine published by Credit Suisse for its staff, one article in the latest issue highlights Michael Tshiyoyo, a 32-year-old human resources employee in the Geneva office of the Swiss bank. In break dancing circles, he’s known as Easyman.

The article describes how Mr. Tshiyoyo “caught the b-boy bug” as a child, devoting himself to learning the moves. He has become so skilled at spinning, flipping and doing headstands that he competes “against the international elite at least once a year,” he tells the magazine.

Mr. Tshiyoyo has gained accolades for one move in particular, the jackhammer, in which he spins while balancing on one hand, his body low to the ground, the article says. Mr. Tshiyoyo reportedly has added a signature flourish.

“Michael’s innovation? He seamlessly takes off his shirt and pants while spinning,” the article originally read. (That line was quietly removed from the website on Friday.)

While it’s no big secret that bank employees have outside interests, banks are not always happy when these traits become public. One Goldman Sachs worker who pursued a passion for rapping while employed at the firm got a chilly reception from his superiors when word got to the media.

A Morgan Stanley employee was once the subject of a Wall Street Journal article describing how he would approach strangers on the subway and try to befriend them. He was fired soon after, according to the newspaper.

The Credit Suisse break dancer, though, appears in a media outlet run by his employer. “The publication aims to be informative, comprehensible, relevant, and entertaining,” according to the About Us section of the magazine’s website.

The articles contained in the magazine “show the human face of Credit Suisse, and provide readers with an insight into worlds they might otherwise never see,” the website says.

The publication is geared toward employees in the private banking and wealth management division of the bank, but the current issue is available to the public online. Among the articles is an interview with the bank’s chairman and another about employees volunteering with a nonprofit group.

A spokesman for Credit Suisse, Thomas Baer, said every issue of the magazine features a couple of employees. “Normally, those are people with interesting hobbies. We do a story about them and also publish the story online,” he said.

A tip of the hat goes to Sarah Butcher of eFinancialCareers for writing earlier about the Credit Suisse article.

Nestlé Selling Stake in Swiss Fragrance Company

LONDON â€" The food giant Nestlé said on Friday that it was selling its 10 percent stake in Givaudan, the Swiss flavors and fragrance company.

The sale of the stake, valued at more than $1 billion, is the latest in a series of divestitures aimed at streamlining Nestlé’s offerings and focusing on more profitable business lines.

The share divesture will be accomplished as a private placement to institutional investors. Goldman Sachs is managing the sale.

“Nestlé has been very satisfied with its holding but believes now is the appropriate time to divest,” the company said in a statement.

Nestlé acquired the stake in Givaudan through the sale of the food ingredient company FIS in a cash-and-stock deal in 2002.

Nestlé, the maker of Kit Kat chocolate bars, Nespresso coffee and Purina dog and cat food, holds 926,562 shares of Givaudan, which were valued at about 1.2 billion Swiss francs, or $1.3 billion, as of the closing price on Thursday.

Shares of Givaudan were down 3.6 percent to 1,191 Swiss francs, in trading on Friday.

In October, Nestlé’s chief executive, Paul Bulcke, said the company planned to sell some of its underperforming brands.

Last month, Nestlé agreed to sell its Jenny Craig brand in North America, Australia, New Zealand and parts of the Pacific to a private-equity firm, North Castle Partners, for an undisclosed amount.

The company sold an Australian ice cream brand in June and two French bottled water brands in July.

Morning Agenda: Fraud in Bitcoin, Unchecked

IN BITCOIN, FRAUD IS QUICKER THAN THE LAW  |  Pump-and-dump schemes are shut down in the financial markets all the time. But such frauds involving digital money like Bitcoin have gone unchecked, Nathaniel Popper reports in DealBook. Government authorities do not agree on which laws apply to Bitcoin, the popular virtual currency â€" or even on what Bitcoin is.

One recent scam began with a call on Twitter: “For insane profits come and join the pump.” The person behind it, a trader known on Twitter as Fontas, told Mr. Popper in a secure Internet chat that he operated with little fear of a crackdown. “For now, the lack of regulations allows everything to happen,” Fontas said in the chat, where he verified his control of the Twitter account but did not give his identity. He added that the world of Bitcoin would benefit when someone steps in to police it, and would stop his schemes when they do.

Mr. Popper writes: “Chinese authorities drew attention to the issue on Thursday when they announced that they were barring Chinese banks from making Bitcoin transactions. The same day, the Bank of France issued its own warning about the potential risks. The news sent the price of Bitcoin tumbling, but it quickly bounced back to near its all-time high of around $1,200.

“Bitcoins are little more than computer code â€" created according to a set algorithm and traded between online wallets using virtual keys. Some people insist that virtual currencies could become a revolutionary new form of payment in the real world. Bank of America became the first major Wall Street bank to release research about Bitcoin on Thursday, noting that it could become ‘a major player in both e-commerce and money transfer.’”

SEARS TO SPIN OFF LANDS’ END  |  Sears Holdings, the struggling retailer run by the hedge fund manager Edward S. Lampert, said on Friday that it had filed to spin off its Lands’ End business by distributing shares to investors. The company said it expected the spinoff to be tax free for shareholders in the United States, except for any cash received in lieu of fractional shares. The move is subject to approval by the board.

LIVELY DEBATE ON PROXY ADVISORY FIRMS  |  Corporate shareholders voting on a merger or the election of directors often take advice from so-called proxy advisory firms, independent groups that analyze such issues. But companies and regulators are growing uncomfortable with the amount of influence these advisory firms wield, DealBook’s David Gelles reports. These critics say that the two main firms, Institutional Shareholder Services and Glass Lewis, are understaffed and often uninformed, and that the firms, which also offer consulting services, are riddled with conflicts of interest.

The Securities and Exchange Commission on Thursday hosted a round-table discussion that examined the influence of proxy advisers. While it has not proposed any rules, the agency is considering if any regulation is needed. The S.E.C. chairwoman, Mary Jo White, said that as the influence of proxy advisers had grown, so had questions about the fairness of their recommendations and decision making.

“I am particularly interested in the discussion of conflicts of interest that may or may not arise in connection with the participation of proxy advisers in our system â€" what they are and views on how they should be addressed,” Ms. White said.

TWITTER ADDS FIRST FEMALE BOARD MEMBER  |  Twitter, which came under fire in the run-up to its I.P.O. for the absence of any women on its board of directors, said on Thursday that it had added the former publishing executive Marjorie M. Scardino to its board. The addition of Ms. Scardino, the first woman to serve as a director at the company, expands Twitter’s board to eight members from seven. Ms. Scardino, 66, is the former chief executive officer of Pearson, the London-based education and media conglomerate. She has also served on Nokia’s board.

Vindu Goel writes on the Bits blog: “Ms. Scardino’s background should certainly help Twitter with its global expansion plans and its efforts to encourage use of the service by the media, including news organizations around the world. Before running Pearson, she ran its Economist Group, which is well known for its deeply reported country and industry profiles. And as the leader of one of the world’s largest publishing companies, she certainly got to know some of the biggest advertisers on the planet.”

ON THE AGENDA  |  The jobs report for November is released at 8:30 a.m. Data on personal income and spending in October is out at 8:30 a.m. John Donahoe, the chief executive of eBay, and David Marcus, the president of PayPal, are on Bloomberg TV at 1 p.m. Art dealers and buyers are in Florida this weekend for Art Basel Miami Beach, where some prices are looking particularly lofty.

SPOTLIGHT ON BLACKROCK  |  The giant asset management firm BlackRock appears on the cover of The Economist. The subheadline reads: “In 25 years, BlackRock has become the world’s biggest investor. Is its dominance a problem?”

SAC WITNESS CONCEDES OMISSION ON ILLICIT DATA  |  Jon Horvath has testified at the insider trading trial of his former boss, Michael S. Steinberg of SAC Capital Advisors, that he was pressured to obtain confidential corporate information to do his job. But on Thursday, Mr. Horvath, a former analyst, conceded that he never explicitly told Mr. Steinberg that the data he had obtained about Dell Inc.’s financial results in 2008 was illicit insider information, DealBook’s Michael J. de la Merced reports.

“No, I never told Mike Steinberg explicitly that it was illegal information,” Mr. Horvath testified.

Mergers & Acquisitions »

Nestle to Sell Stake in Flavors Business  |  Nestlé is offering its 10 percent stake in Givaudan, a flavors and fragrances maker, through a private placement to institutional investors, The Wall Street Journal reports. The stake is valued at nearly 1.2 billion Swiss francs ($1.3 billion).
WALL STREET JOURNAL

A Look Behind Yahoo’s Glittering Surface  |  In an article in Vanity Fair, Bethany McLean examines whether Marissa Mayer, Yahoo’s chief executive, will be the company’s “savior or its next big problem. A year and a half in, the results are mixed.”
VANITY FAIR

Carlsberg Increases Stake in Chinese Brewery  |  Reuters reports: “Danish brewer Carlsberg upped its stake in China’s Chongqing Brewery to 60 percent, strengthening its foothold in the world’s largest beer market by volume, and hopes to increase its holding further, the Chinese company said.”
REUTERS

Total of France to Buy Papua New Guinea Assets  |  The oil giant Total “has agreed to buy a 61.3 percent stake in InterOil’s Papua New Guinea gas fields for up to $3.6 billion, as part of a plan to build a liquefied natural gas export plant,” Reuters reports.
REUTERS

INVESTMENT BANKING »

Los Angeles Sues Citigroup and Wells Fargo Over Mortgages  |  Reuters reports: “The city of Los Angeles has filed a lawsuit against Citigroup and Wells Fargo, seeking damages for a loss in tax revenue due to discriminatory mortgage lending to the city’s minority communities, a court filing showed.”
REUTERS

Banks Step Up Monitoring of Communications  |  Some financial firms “are tapping a cottage industry of software companies that use complex algorithms to monitor traders’ calls and emails â€" looking for catchphrases as well as changes in tone â€" to try to detect signs that traders may be colluding or placing unauthorized bets,” The Wall Street Journal reports.
WALL STREET JOURNAL

‘The Daily Show’ Chides Financial Journalism  |  Samantha Bee, a correspondent for “The Daily Show With Jon Stewart,” questioned why a no-lose credit-default swaps deal by Blackstone hadn’t received wider media coverage.
DealBook »

PRIVATE EQUITY »

Deal Lawyer Joins Willkie  |  Kirk A. Radke, known for his work on private equity deals, is moving to Willkie Farr & Gallagher after a long tenure at Kirkland & Ellis.
DealBook »

Apax, a European Private Equity Firm, Names 2 New Co-Chiefs  |  Mitch Truwitt and Andrew Sillitoe will take over as co-chief executives beginning in January.
DealBook »

HEDGE FUNDS »

Investors, Dismayed by Losses at Sears, Pull Money From Hedge Fund  |  Edward S. Lampert was once hailed as a canny value investor in the same league as Warren Buffett, but his struggles with Sears have disenchanted a number of investors.
DealBook » | Graphic: Lampert’s Legacy

Hayman Capital Sells Penney Stake  |  J. Kyle Bass, the hedge fund manager who runs Hayman Capital, told Bloomberg TV that his firm had sold its shares in J.C. Penney while continuing to hold the company’s debt.
BLOOMBERG TV

I.P.O./OFFERINGS »

Twitter Makes a Push for Global Expansion  |  Twitter “is upping its game on increasing customers outside of the United States, signing deals for prime mobile phone placement in some cases, and for reaching untapped audiences in others,” AllThingsD reports.
ALLTHINGSD

VENTURE CAPITAL »

For Palantir, a $9 Billion Valuation  |  Palantir Technologies, a data analysis company that works with government agencies and financial firms, “has raised $58 million during a funding round that’s expected to top $100 million,” Bloomberg Businessweek reports, citing an unidentified person close to the company. The report says Palantir “is seeking at least a $9 billion valuation.”
BLOOMBERG BUSINESSWEEK

Box Achieves $2 Billion Valuation in Financing Round  |  The Wall Street Journal reports: “Box Inc. has secured $100 million in funding at a valuation of about $2 billion, said chief executive Aaron Levie, as new international investors plan to help the online storage provider expand outside the U.S.”
WALL STREET JOURNAL

Glassdoor, a Jobs Website, Raises $50 Million  |  Glassdoor, a job listings site that lets employees anonymously rate and dish on their companies, said on Thursday that the latest round of financing nearly doubled its total fund-raising to $93 million.
DealBook »

Homejoy Raises $38 Million in New Round  |  Homejoy, a year-old start-up that connects customers with prescreened cleaners, said on Thursday that it had raised new capital from investors that included Google Ventures, Redpoint Ventures and the entrepreneur Max Levchin.
DealBook »

Government Push Behind London’s Tech Scene  |  “In part, London’s growth into a European tech hub has been because of support from the British government,” Mark Scott writes on the Bits blog. “Central to that initiative is the Tech City Investment Organization, a state-backed body in charge of promoting London’s tech community, which will celebrate its third anniversary on Friday.”
NEW YORK TIMES BITS

LEGAL/REGULATORY »

California City Returns to Solvency With Pension Problem Unsolved  |  Stockton, a struggling city in California’s Central Valley, is nearly ready to leave bankruptcy court protection. “But what Stockton, along with pretty much every other city in California that has gone into bankruptcy in recent years, has not done is address the skyrocketing public pensions that are at the heart of many of these cases,” The New York Times writes.
NEW YORK TIMES

Kozlowski’s New Job: Software Company Clerk  |  L. Dennis Kozlowski, the onetime chief executive of Tyco International, has had a clerical job as part of a work-release program at a company that provides software to help veterans and ex-offenders.
DealBook »

Gupta Suit Against Partner Is Dismissed  |  Rajat Gupta had accused a former longtime friend of trying to stop him from having a say over a private equity fund they started together.
DealBook »

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Sears to Spin Off Lands’ End

Sears Holdings, the struggling retailer run by the hedge fund manager Edward S. Lampert, said on Friday that it had filed to spin off its Lands’ End business by distributing shares to investors.

The company said it expected the spinoff to be tax-free for shareholders in the United States, except for any cash received in lieu of fractional shares. The move is subject to approval by the board of Sears Holdings.

Faced with plummeting sales and other challenges, Sears first announced in October planned to spin off Lands End to raise cash. The company had long faced pressure from competitors including Walmart, Target and Home Depot, while online shops like Amazon and others have forced brick-and-mortar stores to cut prices.

Sears acquired Lands End in 2002 for $1.9 billion. The spinoff of the company would follow Sears’ sale of another business, Sears Home and Outlet Stores. The company may still try to find a buyer for Sears Auto Centers. Some analysts have contended that the company will continue a liquidation process that could include Kenmore and Craftsman, two brands named as possible targets, as well as some of the company’s real estate holdings.