Midterm Mayhem

November 10, 2022

Good Morning,

Petrol prices in New Zealand could be set by the Commerce Commission, British Christmas shopping has started earlier, the US midterm elections are down to the wire in the race for the senate, whilst the house looks likely to be won by the republicans, US consumer confidence is near its lowest in a decade, Meta has announced 11,000 jobs will be cut & there was crypto drama.

Let's jump in.

Before The Bell

Markets

  • The NZX was flat.

  • The ASX lifted on increased iron, gold & lithium prices. (AFR)

  • All three major US indexes gained as investors anticipated midterm election results.

  • Major crypto crashed on the back of FTX, facing a liquidity crunch.

Earnings

  • BNZ increased net profit by 7% to $1.4B (NZD) and warned of potentially negative issues when mortgage customers rolled off fixed-term rates. (NBR)

  • Carlyle Q3 AUM fell 2% to $369B, fundraising slowed by 40% to $6B, and available capital for investment dropped ~9% to $74B on market volatility. Its stock fell 7.7%. (FT)

  • Manawa Energy has reported a 64% drop in profit over the half-year. Its shares were down 8.7%. (NBR)

  • NAB produced a net profit of $6.89B (AUD), an 8.3% increase. It also increased cash earnings by over 8%. It dropped 0.91%. (NBR)

  • News Corporation reported that net income was down 75% in the first quarter of FY23, revenue was down 1%, and operating earnings were down 15%. These results were lower than expected. Its shares fell 11.15%. (AFR)

  • NZME has downgraded its full-year earnings guidance. (Herald)

  • Pushpay Holdings announced that total processing volume was up 2% and underlying EBITDAF was down 10%. It also adjusted guidance for revenue growth to between 4% and 8% and said it would fail to meet its growth targets for 2025. Its shares increase by 0.8%. (NBR)

  • Walt Disney missed Q4 profit and key revenue estimates on struggling D2C and theatrical businesses. Additionally, it warned that Disney+ streaming growth might taper going forward. Its stock fell 6.8% in AH trading. (CNBC)

News Summary

  • Three Waters National Transition Unit has moved into a central Auckland space. (Stuff)

  • Petrol prices in New Zealand could be set by the Commerce Commission after tweaks to the rules. (Stuff)

  • There will be no debt-to-income controls on housing in New Zealand before at least March 2024. (Stuff)

  • New Zealand is out of the T-20 World Cup after losing to Pakistan in the semi-final. (Stuff)

  • British Christmas shopping has started earlier as consumers try to spread the costs over a longer period of time. (RT)

  • Italy's economic minister has promised fiscal prudence and lower debt. (RT)

  • The US midterm elections are down to the wire in the race for the senate, whilst the house looks likely to be won by the republicans. (BBC)

  • US consumer confidence is near its lowest in a decade. (CNBC)

  • A US Powerball customer has won $2.04B (USD). (AX)

  • Meta has announced 11,000 jobs will be cut. (BBG)

  • Netflix is exploring investment into live sports and has placed bids on streaming rights. (WSJ)

  • Citigroup and Barclays have joined rivals in cutting investment banking jobs. (BBG)

Deal Flow

Investments/ M&A

  • Microsoft's $69B (USD) deal for game developer Activision will face an in-depth probe by the EU. (BBG)

  • Vodafone Group, a British telecommunications group, has sold a stake in its tower arm (Vantage Towers) to PE firms KKR and Global Infrastructure Partners, which implies a valuation of $16.3B (USD). (BBG)

  • Elon Musk has sold ~$4B (USD) in Tesla shares. (BBC)

  • One Rock Capital Partners, a PE firm, is considering the sale of portfolio company Innophos Holdings which is a food additives maker. A deal could fetch as more than $3B (USD). (BBG)

  • PE firm Fortress Investments is close to acquiring Japanese department chain Sogo & Seibu from Seven & I Holdings for more than $1.4B (USD). (BBG)

  • Wireless operator Veon is in advanced talks to sell its Pakistani tower assets. They are believed to be valued at between $600m & $960m (USD). (BBG)

  • A $50m (NZD) oil field deal between Jadestone Energy and OMV has been terminated. (Stuff)

  • Next, a clothing, footwear and home products retailer has agreed to buy collapsed UK furniture retailer Made.com for $3.9m (USD). (BBG)

  • PE firm BPEA and alternative investment manager Regal Partners have increased their bid for fund manager Perpetual to $33 (AUD) a share. (AFR)

  • Citigroup has agreed to buy Deutsche Bank's license in Mexico. (BBG)

  • New York State is leading a movement to block Meta's takeover of virtual reality app Within Unlimited. (BBG)

  • The German government has blocked the sale of Elmos Semiconductor's wafer facility to a Chinese investor. (BBG)

  • The Italian government is weighing up its options for debt-ridden Telecom Italia. The options include a possible state-backed takeover offer. (BBG)

  • Crypto exchange Binance will purchase fellow crypto exchange FTX after it buckled under a potential liquidity crunch. (BBG)

  • Gold Fields, a mining company, has terminated its takeover deal for fellow miner Yamana Gold after Yamana backed a rival offer. (BBG)

  • Beer brand Anheuser-Busch has bought a Major League Pickleball team. (CNBC)

VC & Fundraising

  • IT services group Tecla Partners has received an $18m (AUD) investment from Armitage Associates. (AFR)

Equity Raises

  • Emirates Central Cooling System Corp has raised $724m (USD) via its IPO after pricing at the top end of the range. (BBG)

  • Forme, a connected fitness startup, has filed for a US IPO. It is hoping to raise ~$50m (USD). (BBG)

Debt Raises

  • Banks led by Bank of America have sold $2B (USD) worth of junk bonds for the leveraged buyout of TV ratings business Nielsen Holdings at an 11% yield. (BBG)

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