Power Sheet – July 1, 2016

-The biggest story is Boris Johnson’s surprise withdrawal from the race to succeed David Cameron as prime minister. We mentioned it yesterday as the news broke, and far deeper coverage is now available. You can read all about the betrayals, base motivations, and secret alliances behind the decision of Johnson’s intended campaign manager, Michael Gove, to announce his own candidacy just three hours before Johnson was to announce his, and the calculations driving the three other candidates. If you come across an article about it in U.S. Media that doesn’t mention House of Cards or Game of Thrones, please let me know.

The larger question may be how anyone could possibly succeed at leading Britain through two years of negotiations with the EU that are virtually guaranteed to disappoint the electorate, a period when the costs of Brexit will almost certainly outweigh any eventual benefits. Voters may wonder if anyone crazy enough to want this job should actually have it.

-Mondelez International’s bid for Hershey pits two headstrong and successful CEOs against one another. Mondelez’s Irene Rosenfeld turned around Kraft, from which Mondelez was spun off in 2012; its stock has almost doubled since then. Hershey’s John Bilbrey rescued that company after becoming CEO in 2011, and its stock also has nearly doubled. Hershey promptly rejected Mondelez’s offer yesterday, which by itself means little; that’s a standard bargaining tactic. But Bilbrey has never struck me as a CEO who’s eager to hand over his work-in-progress to someone else, and Rosenfeld does not shy from a fight, as she demonstrated when activist investors Nelson Peltz and Bill Ackman targeted her at Kraft. A further complication: A charitable trust controls 81% of Hershey’s shareholder votes and has rejected takeover bids in the past. This drama is worth watching.

–Marissa Mayer presided over Yahoo’s annual meeting yesterday, and it was snore-worthy for its entire, brief, 45-minute duration. There’s nothing left to say. As she has done for months, she spoke in a strange, other-worldly way about Yahoo’s “compelling products” and business model when all anyone cares about is how much the company will get as it sells those internet operations. I suppose she wants to keep talking up the businesses in order to encourage higher bids, but I suspect Verizon and the other bidders have already made up their minds about the business’s value.

-Lawyers argued in a Massachusetts courtroom over Sumner Redstone’s mental capacity in a case we described yesterday. Nothing new of significance came out. The most compelling factoid: More than 40 lawyers were in the courtroom. This mess will get worse before it gets better.

We’ll be back on Tuesday. If you’re in the U.S., enjoy the long weekend.

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What We're Reading Today

Phil Knight steps down as Nike's chairman
The change ends a year-long transition for the Nike founder, who becomes chairman emeritus 52 years after launching the company and can now attend board meetings at his leisure. CEO Mark Parker adds the chairman title, per Knight's wishes. Apple CEO Tim Cook, a Nike director since 2005, will be lead independent director.  Coins2Day

AG Lynch to accept Clinton email investigation recommendations
The decision comes a few days after Loretta Lynch met with Bill Clinton at a Phoenix airport, raising concerns that the FBI investigation into Hillary Clinton's email could be tainted. While Lynch said the meeting was unplanned, she will announce that the Justice Department will accept the recommendations of the FBI and prosecutors. But she did not recuse herself from the case. NYT

Investigators eye Tesla's autopilot feature...
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Lawyers battle in Massachusetts over National Amusements
The dispute over Sumner Redstone's competence to remove Viacom CEO Philippe Dauman and director George Abrams from his trust and the board of National Amusements got to court Thursday. Dauman's lawyers argued that Redstone's mental capacity should be evaluated to determine if he is capable of making decisions or is controlled by his daughter, Shari. Redstone's lawyers says he is alert and aware. It's unclear when Judge George Phelan will rule.  The Hollywood Reporter

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Worth Considering

Hershey rejects $23-billion deal with Mondelez
John Bilbrey's company said it rejected the deal and sees no need to continue discussions with Irene Rosenfeld's Mondelez. She'll need to persuade the controlling shareholder, the founder-created Hershey Trust, which was apparently not swayed by promises that Hershey would keep its name. A deal would combine two of the world's top five candy makers. CNBC

P&G revamps manager bonuses
Starting today, bonuses will be tied to the performance of managers' individual units, not to regional performance. The change by CEO David Taylor is meant to ignite sales at a company that has created few blockbuster new products over the past decade. WSJ

Six Williams Cos. Directors resign
A day after Energy Transfer Equity won court permission to walk away from its proposed acquisition of Williams, six directors, led by chairman Frank MacInnis, tried and failed to oust CEO Alan Armstrong. They then resigned. All six had favored the deal, which Armstrong had opposed.  Coins2Day

Coins2Day Reads and Videos

High ranking Chipotle executive named in drug ring indictment
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The home of Disneyland bans Airbnb rentals
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Apple considers buying Tidal music streaming service
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CEO Marissa Mayer says Yahoo...
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