Darktrace is ultimate test of IPO risk appetite 17 Feb 2021 The cyber group’s top investor, Autonomy founder Mike Lynch, is facing U.S. extradition on fraud charges. Its top ranks are packed with his former colleagues. UBS has dropped out of the $5 bln listing. Pushing ahead despite such red flags suggests investors may pinch their noses.
Parental anxiety complex births $1.4 bln SPAC deal 16 Feb 2021 Baby monitor firm Owlet is listing through a blank check firm with a valuation that puts a high price on parental paranoia. Baby spending is rising, and Owlet promises to be the “digital nursery of tomorrow.” But its projections are as unrealistic as new parents’ expectations.
Capital Calls: Bubble alert 16 Feb 2021 Concise views on global finance in the Covid-19 era: Bitcoin burst through $50,000, and global fund managers are maximum bullish on the pace of the recovery from the pandemic.
WeWork tiptoes back to the water cooler 10 Feb 2021 The office-sharing firm may go public via a SPAC, its first foray with public investors since 2019’s disastrous flirtation. This time WeWork has fewer quirks, improving cash flows and less hype. At $13 bln, well below its peak valuation, a deal looks doable.
Son’s gene-sequencing goose may lay eggs elsewhere 10 Feb 2021 Pacific Biosciences has lagged goliath Illumina in selling DNA reading machines. A $900 mln investment from Masayoshi Son's SoftBank Group may give it a leg up. But competition will accelerate deflation in the price of gene sequencing, making users the biggest winners.
Jeff Ubben’s soft touch could help hardened Exxon 5 Feb 2021 The activist behind Inclusive Capital may join the $204 billion oil giant’s board. He helped usher Ballmer out of Microsoft and encouraged an aging Adobe to transform. With vocal and quiet agitators at Exxon, shareholders need a diplomat. Ubben’s experience could prove useful.
Small-stock mania calls for big-picture thinking 4 Feb 2021 Treasury Secretary Janet Yellen and other market sheriffs are convening to discuss the impact of the GameStop saga. There may be a case for throwing sand in the gears of retail investing, to offset fee-free trading and gamification. But the less regulators intervene the better.
Deutsche’s trim investment bank is model for peers 4 Feb 2021 CEO Christian Sewing’s 2019 decision to scrap equities trading, while shrinking costs and capital, hasn’t undermined the remaining wholesale business. The lender’s fixed-income units may even be gaining market share. HSBC, Credit Suisse and others needn’t fear a radical overhaul.
Outer space may be best place for SPAC craze 3 Feb 2021 Rocket-making startup Astra is launching into public markets at a $2.1 bln valuation through a blank check company. So-called SPACs are a frothy frontier, but they’re well suited to businesses that rely on long-term future projections. A bet on the space industry fits the bill.
Tilman Fertitta takes liberty with SPAC menu 2 Feb 2021 The Texas billionaire is selling his casino and steak combo to a blank-check company. That’s after he used one of his own SPACs to buy his online-gaming unit, and another to acquire a food-delivery service that was later sued. If a SPAC serves it up, Fertitta is ordering.
UK’s austerity guru shows better timing as banker 2 Feb 2021 Ex-finance minister George Osborne will join boutique Robey Warshaw. His frugal policy in office, now derided, and few banking skills make him an odd hire. Yet political savvy is ever more critical in M&A given state meddling, and Covid-19 pressures herald a surge in dealmaking.
If only American Airlines’ stock pop helped it 28 Jan 2021 Shares of the struggling government-supported $10 bln airline surged 60% in premarket trading after a mention on the same online forum that boosted GameStop. Ideally, American could issue equity at a pumped-up valuation. But the phenomenon may be too fleeting to take advantage.
UBS strength risks stifling new CEO’s reform zeal 26 Jan 2021 Ralph Hamers inherits a bank with a respectable valuation, tons of capital and healthy returns. Such performance could make him less likely to effect major changes at the $54 bln lender. That could be a problem given long-term weaknesses like slow growth and high costs.
Buyout shops make SPACs pass-the-parcel besties 25 Jan 2021 Blackstone is selling benefits service provider Alight to a blank-check firm for $5.4 bln, a second such transaction in two months. The market for private equity firms offloading companies to SPACs increased sixfold in 2020. In frothy conditions, deals won't always be sensible.
Perella Weinberg deal boosts SPAC credibility 21 Jan 2021 A $977 million price tag for the M&A advisory shop values it lower than peers based on reasonable growth assumptions. It's a sensible figure for a real business in a competitive market. Perella's choice to go public by selling to a blank-check company looks well advised.
Morgan Stanley serves up best of two weird worlds 20 Jan 2021 Covid-19 delivered a trading windfall for James Gorman’s firm as it did for rivals, adding about $5 bln to 2020 revenue. Banks can’t rely on a repeat of 2020’s dislocations, but Gorman’s stock-fueled M&A means Morgan Stanley can shrewdly reach the masses while low rates continue.
Even drug firms think they are overvalued 19 Jan 2021 At least that’s what deal data is saying. Healthcare firms raised over $20 billion in IPOs in 2020, twice as much as any other year in two decades. Yet the value of M&A, which drives growth for big firms, fell by nearly half. Stretched valuations may explain both trends.
Goldman progress masked by trading boom, bad deeds 19 Jan 2021 The Wall Street firm’s $8.9 bln earnings were buffeted by surging markets and fines for its role in a giant bribery scandal. Underneath it all, Goldman is becoming more efficient. And as a latecomer to retail banking, it is spared the painful impact of falling rates and lending.
Roblox float seeks to share public-listing love 7 Jan 2021 The gaming platform scrapped its IPO for a direct listing of its shares. That’s an easier financial decision with $520 mln of new funds raised at a valuation of nearly $30 bln – more than 7 times its worth a year ago. But it also offers more stakeholders a chance to participate.
Qualtrics’ German parent will SAP its IPO value 6 Jan 2021 The survey maker’s float coincides with sky-high multiples for software peers. Its high revenue growth rate could in theory merit a price tag of $20 billion or more. Yet a potentially meddlesome controlling shareholder in European behemoth SAP argues for a hefty discount.