Will you Pay for the Blue Tick?

November 07, 2022

Good Morning,

The Reserve Bank of New Zealand stress testing has revealed banks can cope with a 47% decrease in house prices and a 9% unemployment level, the Reserve Bank of Australia raised rates by 25 basis points, Sky TV's shareholders are aggrieved by the share consolidation, the Federal Reserve raised the Federal Funds Rate by 75 basis points, the Bank of England raised interest rates by 75 basis points, Michael Hill Jewellers are rolling out DNA spray machines & Twitter has confirmed it will charge a fee for blue-tick verification.

Before The Bell

Markets

  • It was an up-and-down week for the markets after three major rate decisions by the RBA, Fed and BoE. The UK markets had the best week, and the US markets the worst.

Earnings

  • AoFrio achieved an 18% increase in revenue in Q3 2022 and a 0.9% increase in gross margin. (NZX)

  • BP announced its second-highest quarterly profit ever of $8.2B (USD). It announced it would carry out a further $2.5B (USD) share buyback. (BBG)

  • Briscoe Group's sales were up 27% in the third quarter year on year. (NBR)

  • Fulton Hogan has notched up a record result. Net profit was up to $301m (NZD) from $282.9m (NZD). Additionally, revenue was up 10%, and dividends were up 4c a share. (NBR)

News Summary

Monday

  • The New Zealand government is open to tweaking the three waters reforms after a coalition of mayors pushed a new idea. (Stuff)

  • The Reserve Bank of New Zealand stress testing has revealed banks can cope with a 47% decrease in house prices and a 9% unemployment level. (Stuff)

  • Accusations are flying around as Callaghan Innovation and small business Manaaki face off. (Stuff)

  • The Egyptian Central Bank has raised rates by 200 basis points. (RT)

  • Luiz Inácio Lula da Silva is the new president of Brazil. (BBC)

Tuesday

  • More than 70,000 people attended the Melbourne Cup, which Gold Trip won. (9 News)

  • The Reserve Bank of Australia raised rates by 25 basis points, and warned rates will go even higher to fight the evils of inflation. (AFR)

  • Eurozone inflation hit a record high of 10.7% in October, and GDP growth shrunk to 0.2%. (FT)

Wednesday

  • Sky TV's shareholders are aggrieved by the share consolidation. (NBR)

  • AUSTRAC has launched a new probe to investigate suspected dirty cash flowing through one of Australia's largest bookmaker and its smaller rivals. (AFR)

Thursday

  • $70 million NZD from the Government's Covid Fund has been repurposed for Three Waters policy and communication work. (Herald)

  • Investment bankers are gearing up for weakest bonus pool in decades. (AFR)

  • The Federal Reserve raised the Federal Funds Rate by 75 basis points, and Jerome Powell signalled that future rate hikes would be smaller but reach a higher peak. (BBG)

Friday

  • The Bank of England delivered its eighth consecutive hike and increased interest rates by 75 basis points to a bank rate of 3%. (CNBC)

  • The Black Caps secured a semifinal spot after defeating Ireland in the T20 World Cup. (Stuff)

  • Morgan Stanley is looking to cut roughly 50 investment bankers in Asia. (BBG)

Weekend

  • 1,200 native plants have been destroyed in a Canterbury blaze caused by fireworks. (Stuff)

  • Michael Hill Jewellers are rolling out DNA spray machines in an attempt to reduce burglary attempts. (Stuff)

  • Current and ex-US presidents have descended on key swing states ahead of the midterm elections. (BBC)

  • Twitter has confirmed it will charge a fee for blue-tick verification. Additionally, around half the staff have been laid off. (BBC)

  • Ukraine has accused Iran of terrorist cooperation after admitting it supplied drones to Russia. (BBC)

Deal Flow

Investments/ M&A

  • Johnson & Johnson, an American multinational that develops medical devices, pharmaceuticals & consumer packaged goods, will acquire heart pump maker Abiomed in a deal valued at $16.6B (USD). (RT)

  • KKR is vying with Cellnex for a $14 billion USD Vodafone tower arm. (BBG)

  • US industrial firm Emerson Electric has sold a majorty stake in its climate technology unit to alternative investment firm Blackstone. The deal valued the unit at $14B (USD). (RT)

  • EQT is leading the bidding for a stake in $9 billion USD tower firm TDF. (BBG)

  • Walgreens-controlled VillageMD, a primary healthcare provider, is exploring a deal to merge with Warburg Pincus-backed Summit Health, a healthcare network and parent of CityMD. The deal would value the combined entity at $5B to $10B (USD). (BBG)

  • HSBC's Candian unit has lost the National Bank of Canada and Candian Imperial Bank of Commerce as bidders. However, the Bank of Montreal is still pursuing the deal. It is believed to be valued at $5.88B to $7.35B (USD). (RT)

  • COSCO Shipping will buy $2.7B (USD) worth of port assets from its parent. (RT)

  • Thermo Fisher Scientific, an American supplier of scientific instruments, consumables, and chemicals, is nearing a deal to acquire England-based diagnostic firm Binding Sites from PE firm Nordic Capital for ~$2.3B (USD). (BBG)

  • Penguin Random House's $2.18B (USD) takeover of rival book publisher Simon & Schuster has been blocked by a US federal judge. (BBG)

    • German media group Bertelsmann SE & Co, who own Penguin Random House,will appeal the ruling. (RT)

  • State-owned phone carrier PT Telkom Indonesia is exploring deals for its $1B (USD) data centre unit. (BBG)

  • Bank of America has been asked to review and most likely sell a controlling stake in TPG's broadband network business Vision Network. It could be worth upwards of $1B (AUD). (AFR)

  • Abu Dhabi Ports has bought a stake in a Dubai shipping firm for $800 million USD. (BBG)

  • The proposed merger of Cordish Dixon PE firms has been called off after investors voiced their displeasure about merging the three funds into a combined entity with a valuation of $650m (AUD). (AFR)

  • Asda, a British supermarket chain, has completed their £600m takeover of Co-Op petrol forecourts. (BBG)

  • Gaw Capital Partners, a Hong-Kong-based real estate PE firm, is close to a deal for alternative investment firm Blackstone's Tokyo assets for $540m (USD). (BBG)

  • PE firm Pacific Equity Partners is reading a ~$500m (AUD) bid for education and workforce software group ReadyTech. (AFR)

  • Davide Campari-Milano NV, an Italian aperitif specialist, is acquiring a 70% stake in US bourbon maker Wilderness Trail Bourbon for $420m (USD). They also have plans to acquire the remaining 30% by 2031. (BBG)

  • Malaysian-based RHB Bank plans to introduce a digital platform in 2023 via a joint venture with Boost, an arm of communications giant Axiata Group that could invest as much as $212m (USD) in the venture. (BBG)

  • Digital asset platform Bakkt has agreed to purchase Apex Crypto for up to $200m. (CD)

  • Gulf Capital has sold Chef Middle East for $100 million USD. (BBG)

  • George Kerr’s real estate company RCL Group has agreed to buy a 163ha block of development land near Queenstown for $70 million NZD. (NBR)

  • Telco infrastructure play Superloop has acquired VostroNet, a leading provider of high-speed internet, for $34m (AUD). (AFR)

  • Qatar is in talks with TotalEnergies, a French multinational integrated energy and petroleum company & Eni SpA, an Italian multinational energy company, for a 30% stake in an exploration block in waters off Lebanon. (BBG)

  • Top global battery maker Contemporary Amperex Technology Ltd has agreed to take an almost 25% stake in CMOC Group which is a major cobalt producer. (BBG)

  • Brickworks, a brick manufacturer, has purchased another large parcel of FBR shares, a bricklayer robot maker. Broker MST crossed 35m FBR shares which is a 1% stake in the company taking Brickworks' total stake to ~16%. (AFR)

  • Billionaire Tilman Fertitta acquired a 6.1% stake in Wynn Resorts, a hotel and casino company. (BBG)

  • Private equity firms Regal and EQT have offered $30 AUD per share to takeover investment funds business Perpetual. (AFR)

  • A KKR portfolio company Alludo, an American software company, has bid $2 (AUD) a share for Nitro Software. (AFR)

    • Nitro Software board will not accept an offer of $1.80 (AUD) from Potentia Capital. (AFR)

  • Goldmans Sachs' group Petershill unit has acquired a minority stake in LLR Partners. (BBG)

  • Gucci owner and french luxury giant Kering is in the process of advanced talks regarding acquiring Tom Ford. (WSJ)

  • Shoe retailer Aquila hires adviser to explore sale. (AFR)

  • Private equity firms have stepped up their chase of window and doors manufacturer Jeld-Wen Australia with bids due to auctioneer Macquarie Capital, next week. (AFR)

  • Byron Allen IS set to bid on NFL team Washington Commanders. (BBG)

  • Central Healthcare is seeking Commerce Commission approval to acquire an ownership interest in the Crest Hospital. (NBR)

  • Chinese insurer Daija Insurance Group is in talks to sell luxury hotels in Scottsdale, Arizona & Jackson Hole. (BBG)

  • China Merchants Group, a state-owned firm, is considering a takeover bid for Bain Capital-backed Chinese data centre operator Chindata Group Holdings. (BBG)

  • Software company ReadyTech's second biggest shareholder Microequities Asset Management has expressed concerns about the offer from PE firm Pacific Equity Partners. (AFR)

  • PE firm Silver Lake is looking at exit options for TEG, a ticketing and live entertainment business. Options include a sale or a float. (AFR)

  • IMF Investors' private equity arm is one of the last bidders for Australian radiology company PRP Diagnostic Imaging. (AFR)

  • PAC Capital, an Australian hedge fund focusing on Esports and gaming, has acquired Clearwater Portfolio Management. (AFR)

VC & Fundraising

  • Australian buyout firm Quadrant Private Equity has raised $255m (AUD) from investors, including Future Fund and ROC Partners, for a new single asset fund that will buy and own the group's auto parts distributor MotorOne. (AFR)

  • Blackbird Aotearoa has secured $75 million NZD for a second NZ startup fund. (NBR)

  • The startup The Mobility House raised $50m Series C led by Mercuria and co-led by Ventura Capital and Green Gateway Fund. (BW)

  • Australian hearing device start-up Hemideina was one of the businesses that presented at stockbroker Wilson's annual 'Great Drugs & devices' conference. It is believed Hemideina is angling at a ~$20m (AUD) series B next year. (AFR)

Equity Raises

  • Credit Suisse has invited at least 20 banks to join a syndicate for a $4B (USD) rights issue. (BBG)

  • KFC and Pizza Hut operator is set for $2 billion USD UAE, Saudi IPO. (BBG)

  • MidEast KFC operator Americana Group is set for an Abu Dhabi and Riyadh dual listing which will see a 30% stake up for sale that could raise ~$1B (USD). (BBG)

  • India's Byju is in the process of finalising plans for the $1B IPO of its Aakash Educational Services. (BG)

  • Dubai has increased the size of the Emirates Central Cooling Systems Corp by 50% on strong demand meaning a 15% stake will be sold, which could raise $543m (USD). (BBG)

  • Credit Suisse & CICC are said to have been picked for a sale of GDRs in Switzerland for the Chinese e-commerce platform Beijing United Information Technology Co, which could raise $500m (USD). (BBG)

  • Spain's Finetwork is considering raising USD$489m to assist in funding growth strategy. (BBG)

  • Dubai is seeking to raise $362m (USD) from Emirates Central Cooling System, a district cooling company, by selling a 10% stake. It is priced at $0.36. (BBG)

  • Dubai private school operator Taaleem Holdings is seeking to raise $204m (USD) via an IPO. (BBG)

  • Abu Dhabi AI firm Bayanat AI more than tripled in its Abu Dhabi trading debut after raising $171m (USD). (BBG)

  • Australian Strategic Metal, a critical metals play, is seeking $30m (AUD) via a share placement at a 12.4% discount. (AFR)

  • Greenfern Industries closed its rights issue, having raised ~$1.74m (NZD). (NZX)

  • Enprise Group, an NZ software and services investment company, has launched a 1 to 10 rights offer which aims to raise ~$1.38M (NZD). (NZX)

  • Middle eastern broadcaster MBC Group is said to have shoulder-tapped HSBC and JPMorgan for IPO. (BBG)

  • African Agriculture is nearing a deal to go public through a 10X SPAC. (BBG)

Debt 

  • Musk's lenders are preparing to hold $12.7B (USD) of Twitter debt on their books until early 2023. (RT)

  • Goldman Sachs and Sixth Street are the lead lenders in a $2.6B (USD) loan for Blackstone's Emerson deal. (BBG)

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