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Deal: Al Gore's Firm Invests $600M In UK Green Energy Startup

Generation Investment Management , an investment firm co-founded by former US Vice President Al Gore, has made a big bet on a British green energy startup. It's investing $600mn in Octopus Energy , a startup that supplies renewable energy to individual customers and businesses. Generation Investment has since its founding focused on sustainability investments, so its large investment in Octopus isn't unexpected. The firm manages some $36bn in assets, making it one of the largest sustainability investment firms globally. For Octopus Energy, the $600mn investment values it at $4bn pre-money . It's split into two equal tranches of $300mn, the first provided immediately and the second by June 2022, contingent on certain conditions. Ultimately, Generation Investment will acquire a 13% stake in the British company. Octopus Energy was founded in 2016 and has grown rapidly for a startup of its kind. Its main business is generating or purchasing electricity from renewable sources

EVs: Lordstown Sells Ohio Factory To Foxconn For $230M

Lordstown Motors (NASDAQ: RIDE), an embattled electric car startup, has struck a deal to sell its only automotive factory to Foxconn , the Taiwanese manufacturing giant famously known for assembling Apple's iPhones. Foxconn will pay $230mn for the factory and then  invest $50mn in Lordstown to support the EV startup's operations. The factory of concern, located in Ohio , was a former facility of automaker  General Motors that Lordstown bought after it closed down. Notably, GM lent Lordstown $40mn that the fledgling startup used to take the factory off its hands. The Ohio factory was the essential ingredient in Lordstown's operations as it set out to woo investors for capital with a lofty goal of mass-producing electric trucks. Lordstown succeeded in raising capital, in fact, nearly   $700mn from a SPAC merger , but later hit a wall. Soon after the merger, it warned of insufficient capital to fund commercial production and stirred a crisis. After warning of insufficie

Markets: Zoom Walks Back On $15B Five9 Deal

Zoom , the video-conferencing software giant, has walked back on what could have been its biggest acquisition to date. It's terminated its plan to buy Five9, a cloud-based call center software provider, for $14.7bn,  all with Zoom shares. Zoom announced that it terminated the acquisition because it didn't obtain enough support from Five9 shareholders to proceed. It's not surprising because Zoom's stock has dropped 26% from the day it agreed to buy Five9 till now, and given the deal was all with shares, the implied $14.7bn price tag also dropped by 26% to about $11bn, making shareholders reject it. Typically, Zoom could have bumped up the offer either with shares or a cash component if it was keen on buying Five9, but it didn't do so for unclear reasons. It could be because the acquisition wasn't just facing shareholder scrutiny but also scrutiny  from a US government committee  on national security concerns. The national security concern stemmed from Zoom'

Ex-Goldman Sachs Compliance Analyst Charged With Insider Trading

The US Securities and Exchange Commission (SEC) has opened a case against a former compliance analyst at banking giant Goldman Sachs, accusing him of trading on insider information he obtained by the privilege of his position at the bank. The SEC has filed charges against  Jose Luis Casero Sanchez , a Spanish national and former Senior Compliance Analyst who worked in the Poland office of an " international investment bank" that the agency didn't name. However, Goldman Sachs confirmed that he was an employee during the relevant time period. According to the SEC, Sanchez had access to information on mergers and other transactions Goldman worked for clients. Ironically, he had access to sensitive information because of his role as a compliance analyst working to make sure employees kept the info confidential and didn't engage in insider trading. However, he's accused of being the lawbreaker his job had him on the look for. The SEC claims Sanchez leveraged insider

Deal: Eutelsat Snubs Takeover Bid From French Tycoon Patrick Drahi

It appears that Patrick Drahi , the French telecoms tycoon, is continuing his acquisition spree around the globe shortly after  buying a $3.1bn stake in British carrier BT . But this time, his latest acquisition attempt hit a wall by being rejected. Drahi's latest acquisition attempt is Eutelsat , a French satellite operator listed on the Euronext Paris exchange. It's among the top five global satellite operators in terms of revenue. Eutelsat just confirmed with a press statement  that it had received an offer from Drahi but rejected it. Though Drahi's proposed price tag for Eutelsat wasn't formally disclosed, a Bloomberg report  said it was for 2.8 billion euros ($3.2bn) . Drahi is known for shrewd dealmaking in the telecoms and cable industries, so it's not a surprise he pursued acquiring Eutelsat. He built up his telecoms empire primarily with highly-leveraged acquisitions through his Altice corporation, enough to give him a fortune estimated at $9bn by Forbe

Deal: PE Firm Vista Buys UK Software Firm Blue Prism For $1.5B

Vista , an American private equity firm, has sealed its latest buyout deal for a company based in the UK. It's agreed to buy Blue Prism , a firm that makes Robotic Process Automation (RPA) software, for £1.1bn ($1.5bn) . Under deal terms, Vista will pay £11.25 in cash per share of Blue Prism, which is listed on the London Stock Exchange (LON: PRSM). Once completed, the company will be taken off the public markets into Vista's hands. The $1.5bn deal value represents a 35% premium to Blue Prism's market cap just before it was announced. Notably, Vista says it plans to merge Blue Prism with one of its portfolio companies, Tibco Software , once it acquires it. The private equity firm bought Tibco for $4.3bn in 2014. As it shows, Vista wants to consolidate both companies into one bigger firm that it hopes to exit for a higher value than they were purchased in future time. Merging companies with similar businesses is not new for Vista as the firm has done that in the past with

Crypto Exchange Kraken Fined $1.3M For Offering Illegal Products

Kraken , a popular cryptocurrency exchange, has been fined by the US Commodity Futures Trading Commission (CFTC) after settling a case of offering crypto-based margin trading products without duly registering with the commission, thus making it illegal.  The CFTC brought a lawsuit against Kraken, accusing it of offering margined crypto products between June 2020 and June 2021 without getting the appropriate license(s) required to do so in the US. The required licenses are a Designated Contract Market (DCM) license and/or a Futures Commission Merchant (FCM) license. Kraken has agreed to pay a fine of $1.25mn to settle the case and cease and desist from further violations of the Commodities Exchange Act as charged. The crypto exchange has to stop offering margin products or get the due license(s) if it desires to continue offering them. To the uninitiated, margin trading refers to trading with debt provided by a third party, in this case, Kraken. Kraken allowed US residents signed up

Wells Fargo Just Got Fined, Again

Name one thing that occurs so often that you don't get surprised when you hear of it again? It could be Wells Fargo , the American bank, getting fined by regulators. The bank has been so habitually fined to the extent that it's paid nearly $22bn in total penalties since the year 2000. Barely three weeks ago, Wells Fargo was fined $250mn for a loan fraud case going back to 2018. Now, it's been fined again, this time for overcharging commercial foreign exchange clients. Wells Fargo has agreed to pay a $37.3mn penalty to settle a lawsuit from the US Justice Department (DOJ) accusing the bank of overcharging 771 commercial clients that used its foreign exchange services between 2010 and 2017.  Additionally, the bank will directly reimburse the clients with $35.3mn that it admitted to overcharging them. Wells Fargo admitted that many of its foreign exchange sales specialists overcharged clients by applying larger conversion margins or spreads than they said they would and t

Deal: Endeavor Buys Sports Gambling Firm OpenBet For $1.2B

Endeavor Group Holdings (NYSE: EDR), a media and sports conglomerate that owns the Ultimate Fighting Championship (UFC) league, is making a new big acquisition. It's agreed to buy OpenBet , a British company that makes software for sports gambling operators.  Endeavor will pay $1.2bn to buy OpenBet, split into $1bn in cash and $200mn of stock. It's buying OpenBet from  Scientific Games Corporation , a publicly-traded gambling company that bought it in 2017 as part of its $630mn acquisition of NYX Gaming . Divesting an asset bought as part of a $630mn deal in 2017 for $1.2bn four years later represents a very good return on investment for Scientific Games. The acquisition is strategic to strengthen Endeavor's position in the sports betting ecosystem. Right now, the company's main business in that area is IMG Arena , a provider of live-streamed sports video and data feeds to sportsbook operators around the globe. With OpenBet, the business will be complemented with sof

Deal: Hollywood Agency CAA To Buy Rival ICM

In a historic deal in the talent agency industry, two of the biggest entertainment and sports talent agencies operating in the US are about to merge to become one. It's so that Creative Artists Agency (CAA) , a powerhouse talent agency with a roster of stars, has reached a deal to buy ICM Partners , a rival powerhouse agency. CAA buying ICM is a blockbuster deal that'll see two of Hollywood's most powerful talent agencies merge into one more robust powerhouse. The combined agency would be a more formidable one for arch-rivals such as William Morris Endeavor (WME) and United Talent Agency (UTA) . Normally, CAA, ICM, WME, and UTA are considered the "big four" talent agencies in Hollywood and sports, representing the most significant share of A-list talent across both industries. Now, it appears that the "big four" would soon become the "big three."  CAA is the bigger of the two agencies, commanding a bigger roster of talent and business than IC

Deal: PE Firm EQT Bids $3.9B For German Pet Food E-Tailer Zooplus

EQT , a Swedish private equity firm, has bid to buy Zooplus , a German online retailer of pet food and supplies listed on the Frankfurt Stock Exchange. It's offered 470 euros of cash per Zooplus share, valuing the pet food e-tailer at  3.36 billion euros ($3.94bn) . The offer represents a 69% premium to Zooplus's closing price on the 12th of August, the last day before another private equity firm announced a bid for the company. US-based  Hellman & Friedman  first offered 3 billion euros ($3.5bn) then later raised its offer to 3.29 billion euros ($3.85bn). Now it's been outbid by EQT's higher bid. Zooplus also entered buyout talks with US-based KKR & Co. after Hellman & Friedman had penned its offer. But, the PE rival to Hellman later terminated the talks after Hellman raised its bid from 3 billion euros to 3.29 billion euros. With the competing bids, the final decision rests on a vote by Zooplus's shareholders, requiring majority acceptance for any b

Markets: Covid Testing Provider Cue Health Goes Public

A diagnostics startup that found treasures amid dirt from the Covid-19 pandemic has stamped its success with a successful initial public offering (IPO). It's Cue Health , a little-known startup from San Diego that rapidly switched its focus to making Covid-19 testing kits on the onset of the pandemic and has built a big business with that. Cue Health debuted on the Nasdaq exchange on Friday, the 24th of September, raising $200mn before commissions and other underwriting expenses. Its stock climbed 25% on that day to end trading at $20, giving it a market cap of $2.9bn . Cue Health is one of the significant startup success stories to emerge from the pandemic. Before it started providing Covid testing kits, its annual sales were numbered in the low-digit millions but shot up to $23mn in 2020  on the pandemic's onset and $202mn in the first half of 2021 . Because of its fast pivot to providing Covid testing kits, Cue Health was an early mover. Thus, it got lucrative testing contr

Deal: Blackstone Buys Condor Hospitality's Hotel Assets For $305M

Blackstone , the private equity giant, is yet again adding to its massive commercial real estate portfolio with a big purchase. It's agreed to buy the hotel assets of the  Condor Hospitality Trust , a publicly traded real estate investment trust that's liquidating all its assets and winding down its business. Blackstone will pay $305mn in cash to buy Condor's entire hotel portfolio. The PE firm won't be assuming any debt from the purchase. Condor's portfolio includes 15 hotels in 8 American states, some franchised under prestigious brands like Hilton and Marriott . Hotels are the trust's only business from which it gets all its revenue, and now that it's selling them, the trust has instituted a plan to distribute the sale proceeds to shareholders and close down its operations. Notably, Condor is shutting down after a tumultuous year for hotel operators caused by the pandemic's restrictions on travel and recreation. It, in fact, saw annual sales slip f

Markets: Korea's Kakao Pay Delays $1.3B IPO To November

In South Korea, Kakao is one of the leading tech giants, best known for its  KakaoTalk messenger app. But like many tech companies, it's long branched out from messaging into other sectors such as gaming and fintech and made strides there. In fintech, Kakao has a separate digital bank ( KakaoBank ) and mobile payments and wallet app ( Kakao Pay ). The Korean tech giant took KakaoBank public this July with an IPO that raised $2.2bn and didn't just stop there. It then sought to take Kakao Pay public in a separate IPO but has hit some obstacles trying to do so. Just as it sought to take Kakao Pay public, the South Korean government toughened regulations on fintech apps. It made Kakao Pay suspend some services like insurance though the suspended services accounted for a minor part of its revenue. Then, Kakao Pay adjusted its IPO fundraising target to $1.3bn , 6% lower than it previously sought. But even with the hiccups, Kakao Pay still sought to go public by October this year

Earnings: Nike's Sales Falter, Shares Drop 6%

Sports apparel giant Nike has dropped its latest quarterly results , showing that its earnings still stand firm despite sales challenges intensified by the Covid pandemic. But though its earnings beat analyst expectations, Nike's stock fell by a significant percentage during trading on Friday due to its sales outlook. Nike posted $12.2bn in sales in the three months ended August 31, 2021, its fiscal 2022 first quarter. Sales were up 12% year-over-year and slightly unchanged from $12.3bn in the preceding quarter. Nike's sales have dropped significantly due to the Covid pandemic that led to widespread closures of its physical retail centers. Even as the pandemic effects gradually wear off, the company is still battling supply chain disruptions caused by it. As usual, most of Nike's quarterly sales came from the  Nike brand ( $11.6bn ), while a minority was from the Converse brand ( $630mn ). For the quarter, Nike's net profit was $1.9bn , up 23% year-over-year and 27%

Law: Ex-Quant Analyst Indicted For Front-Running Employer's Trades

Insider trading is like the most common crime on Wall Street or the crime most prosecuted. Every now and then, there's always a new insider trading case pursued by the appropriate American authorities; the Securities and Exchange Commission (SEC) and Justice Department (DOJ). To the unaware, insider trading is deemed as trading a public company's stock or other types of regulated securities based on material, nonpublic information about the company. The latest insider trading saga now making the rounds is that of a former quant analyst who has just been indicted for front-running his employer's trades and making a killing to the tune of over $8mn. Sergei Polevikov , the former quant analyst, allegedly bought securities he knew his employer ordered in large blocks on behalf of clients and then profited from little price bumps of the securities that typically occurred when the large orders were executed. He's said to have done this with a brokerage account opened in his

Markets: Dell Authorizes $5B Share Buyback, Dividend Plan

Dell Technologies (NYSE: DELL) is one of those tech giants that though not lustrous as in their prime, are still going strong with tens of billions of dollars of revenue annually. Others in that camp include IBM, HP, Oracle, et al. In today's news, Dell has announced a new share buyback program of up to $5bn beginning this November. The buyback will start at a projected time when Dell has completed its VMware spin-off that was announced this April, a deal that'll hand over nearly $10bn of cash as a special dividend to it that'll be used to pay down debt. Companies like Dell typically spend billions on share buybacks to stimulate stock growth, companies whose revenues are massive but growing merely in single-digit percentages over the years. Buybacks can be a remedy when revenue growth isn't enough to encourage investor interest. In fact, Dell bought back $562mn  worth of shares in the three months ended July 2021, its most recent fiscal quarter. It concluded the s

Moves: Facebook CTO Mike Schroepfer To Step Down

There's a major leadership change at the social media giant Facebook, Inc . The company's long-time Chief Technology Officer (CTO), in the person of  Mike Schroepfer, is stepping down from his role. His departure plans were made known in a recent SEC filing . Schroepfer will leave the CTO role by next year but won't leave Facebook entirely. He'll be transitioning to the role of " Senior Fellow " at the company, a position that seems to have been created just for him as he'll be the first to adopt it.  When he steps down, Schroepfer will be replaced by a star engineer at Facebook named  Andrew Bosworth , the company's current vice president of augmented and virtual reality. Bosworth is a crucial leader for Facebook's hardware development and R&D efforts and a known close confidant of CEO Mark Zuckerberg. As Bosworth takes up the CTO role, he'll be switching from leading just Facebook's hardware team of 10,000+ employees to both the hard

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Apple Appeals Ruling Of Legal Brawl With Epic Games

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LG To Pay GM Up To $1.9B For Supplying Faulty EV Batteries

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Personal Finance Startup NerdWallet Files For IPO

NerdWallet , a popular financial information website, has unveiled its S-1 paperwork filed with the US SEC for an initial public offering (IPO). It's the latest fintech startup kickstarting a journey to the public markets at a time when investor sentiment towards public fintech companies is very favorable. NerdWallet is a popular online destination for financial advice and information pertaining primarily to Americans. It makes money from promoting financial products to its users and getting commissions when purchased, a very lucrative business, as the S-1 paperwork indicates. According to the S-1, NerdWallet has a big business that's also profitable . The company posted $245mn in revenue and a small net profit of $6mn in 2020. In 2019, it posted $228mn in revenue and a $24mn net profit.  However, in the first half of 2021, NerdWallet posted a net loss $27mn, though its revenue for the same period grew 32% year-over-year to $182mn. Basically, NerdWallet is a very solid busines

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At KKR, Historic Private Equity Barons Step Down

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Deal: Mindbody Buys Fitness Startup ClassPass

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Analysis: Dissecting GitLab's S-1 Filing

This week, one startup caught us off guard with a filing for an initial public offering that was unveiled late on Friday . It was GitLab , a popular code repository hosting service that's the main rival to GitHub .  GitLab recently unveiled its S-1 filing with the US Securities and Exchanges Commission (SEC) as is usual for companies taking the IPO route on the US markets. The S-1 filing provided great insight and detail into GitLab's business with information not publicly disclosed before, and we're here to dissect some of the most important information extracted from the bulky filing. Firstly, we'll be focusing on revenue and sales numbers which is of course the primary statistic for every business. Let's start with the fact GitLab has a solid business model bringing in solid sales and growing steadily, but the company is racking up significant losses.  Business Model : GitLab makes money by charging enterprise customers for paid features and integrations of its