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FB Roundup: VW, Berkshire, and Thomson Reuters

VW caught in monkey test scandal; Berkshire, Amazon, JP Morgan plan healthcare non-profit; and Thomson Reuters family sell F&R business

VW caught in monkey test scandal

The reputation of family-owned Volkswagen has taken another hammering, after it became the scapegoat for emissions tests which forced monkeys to breathe diesel fumes.

VW said it was investigating the allegations first reported in the New York Times. Reports indicated it was among three car makers which paid for tests in which monkeys were gassed with nitrogen oxide emissions from a VW Beetle while watching cartoons. There were also reports of similar experiments on humans.

“Volkswagen has drawn the first consequences in connection with the animal tests financed by the European Research Group on Environment and Health in the Transport Sector,” the company said in a statement, in which it also announced the suspension of a top executive, Thomas Steg, in relation to the scandal.

The testing organisation was funded entirely by VW, BMW, and Daimler. VW is controlled by the third generation of the Piech family, BMW is also partially controlled by a powerful family, as it is 50% owned by the Quandts.

VW’s reputation was already damaged after it admitted in 2015 to fitting millions of cars with special software that allowed them to cheat emissions tests. But it had bounced back, selling a record 10.7 million vehicles in 2017, a 4.3% increase on the previous year.

Berkshire, Amazon, JP Morgan plan healthcare non-profit for 1 million workers

Berkshire Hathaway has partnered with Amazon and JP Morgan to create a healthcare company for its employees “free from profit-making incentives and constraints”.

Berkshire Hathaway, the family holding company of Warren Buffett, issued a statement in which the billionaire described the “ballooning costs of healthcare act as a hungry tapeworm on the American economy”.

“Our group does not come to this problem with answers. But we also do not accept it as inevitable. Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes,” he said.

The three companies have more than one million US employees.

Berkshire Hathaway is the biggest conglomerate in the world, turning over more than $210 billion annually.

Thomson Reuters family sell F&R business

Canada’s Thomson family have sold a stake in their publishing empire to private equity firm Blackstone, which will pay $17.3 billion for 55% of Thomson Reuters’s financial and risk (F&R) business.

Blackstone is one of the biggest fee payers to investment banks. Traders and portfolio managers at investment banks rely heavily on data from Thomson Reuters, as well as competitor Bloomberg when making their market moves.

Thomson Reuters, 63% owned by the Thomson family’s investment vehicle Woodbridge, maintains full ownership of its Legal, Tax & Accounting and the Reuters News businesses. The company was formed in 2008 when the family’s eponymous Canadian news business bought London-based Reuters for £8.7 billion ($12.4 billion).

Shares in Thomson Reuters rose 6.7% following the announcement of the deal, giving it a market capitalisation of almost $32 billion.


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