Intel Plans Germany's Largest Foreign Investment

June 21, 2023

Good Morning,

Intel will spend more than 30 billion euros to develop two chip-making plants in Magdeburg, a deal being hailed on Monday as Germany's biggest-ever foreign investment, Auckland is now the most expensive region to rent in the country after its median weekly asking price climbed to $660 in May, Hyundai Motor will consider making its vehicles more readily compatible with the charging standard Tesla is pushing for in North America.

Let's jump in.

Before The Bell

Markets

  • Asian stocks ended mixed on Tuesday as Chinese growth concerns persisted and investors waited for further direction from Federal Reserve Chair Jerome Powell, who will testify before Congress on Wednesday. A cautious undertone prevailed due to a federal holiday in the U.S. on Monday (RTT)

  • Britain's main share indices fell on Tuesday, dragged down by miners and energy stocks as commodity prices took a hit following a smaller-than-expected interest rate cut by top consumer China (RT)

  • The S&P/ASX 200 closed up 0.9 per cent to 7,357.80, its highest closing pricing since April 20. All 11 sectors advanced except for health care (AFR)

  • US Markets were closed for the Juneteenth Holiday.

Earnings/Data

  • Cost of living's surprising bite on pie sales over the ditch (Stuff)

  • Big NZ banks making profits of $300-per-second (Stuff)

  • Auckland is now the most expensive region to rent in the country, after its median weekly asking price climbed to $660 in May, Trade Me Property says. The property website’s latest figures showed asking rents in the region had gone up 10%, or $60 a week, since May last year. At the same time, the supply of Auckland rentals advertised on the website was down 35% annually, while demand for them was up 55% (Stuff)

News Summary

  • Many buyout firms considered hedging against rising interest rates a waste of time and money. Their debt-laden companies are now paying the price (BBG)

  • Alibaba Group Holding Ltd. is bringing back two of Jack Ma’s longest-serving lieutenants to try and turn around a company that’s struggled to regain its footing since Beijing’s regulatory assault against the internet sector in 2021. Yet investors remain uncertain what they can do to restore an icon of Chinese private enterprise to its former glory (BBG)

  • KKR & Co. has overhauled its Asia-Pacific private equity team in the early stages of allocating capital from its $15 billion regional fund as deal making sputters on strained US-China relations (BBG)

  • All is not well at Perpetual. It seems the listed fund manager has an extended outage on its hands, stemming from an IT security incident at its third-party-provided unit registry system (AFR)

  • High-profile stockbrokers Tony Davis and Mark Gray tendered their resignations at mid-tier stockbroker Shaw and Partners after market close on Tuesday, with fingers pointing towards plans to set up a rival shop (AFR)

  • Kidder Williams, the high-profile Melbourne deal makers specialising in agribusiness and food, have been drafted in by the board of Bubs Australia as the company reworks its market strategy in a bid to save its share price (AFR)

  • The Mount Ruapehu ski season might not go ahead, with local leaders and businesses fearing a big economic hit after a key meeting to decide the fate of two ski fields (Stuff)

  • A prepackaged liquidation sale of Ruapehu skifields Turoa and Whakapapa to new private companies came unstuck at a creditors meeting today amid organised opposition from lifepass holders (NBR)

Deal Flow

Investments / M&A

  • KKR & Co. agreed to purchase as much as €40 billion ($44 billion) of buy-now-pay-later loan receivables from PayPal Holdings Inc. in a deal that frees up the payments giant to do more share repurchases (BBG)

  • Abu Dhabi wealth fund ADQ held preliminary talks to buy boutique investment bank Lazard Ltd., according to people with knowledge of the matter, highlighting the emirate’s continued interest in acquiring a major financial institution (BBG)

  • GTC SA, a real estate company controlled by a foundation set up by the Hungarian central bank, is seeking to expand into Swiss and French luxury properties, in a surprise move away from its focus on eastern European offices (BBG)

  • Orange SA’s $19 billion bid to combine its Spanish operations with Masmovil Ibercom SA is under threat from European Union merger watchdogs unless the firms fix a list of competition concerns set to be issued by regulators (BBG)

  • Waterman Capital is booting up an auction for its Melbourne-headquartered IT services business Fusion5 with price expectations of around $300 million, just as deal makers attempt to resuscitate M&A activity for tech groups (AFR)

  • Civitas Resources on Tuesday said it would acquire oil and gas operations in the Permian basin managed by private equity firm NGP Energy Capital Management for $4.7 billion, expanding its operations into the lucrative shale patch (RT)

  • Energy company NiSource said on Tuesday it would sell a minority stake in its unit, NIPSCO, for $2.15 billion to asset manager Blackstone's infrastructure unit (RT)

  • Global Auto Holdings will buy British car dealership chain Lookers for about 465.4 million pounds ($595 million) in cash, the companies said on Tuesday (RT)

  • The European Energy Exchange (EEX) (T3PA.DE) and Nasdaq (NDAQ.O) said on Tuesday they have reached an agreement under which the U.S. exchange operator will transfer its European power trading and clearing business to EEX. (RT)

  • Hyundai Motor will consider making its vehicles more readily compatible with the charging standard Tesla is pushing for in North America, the South Korean automaker's CEO said on Tuesday (RT)

  • BPEA EQT and ChrysCapital will buy a 90% stake in Housing Development Finance Corporation's (HDFC.NS) education finance arm HDFC Credila for 90.60 billion rupees ($1.11 billion), marking India's largest-ever private equity (PE) buyout in the financial services sector (RT)

  • Civitas Resources Inc is nearing a deal to acquire oil and gas operations in the Permian basin from private equity firm NGP Energy Capital Management LLC for close to $5 billion, including debt, people familiar with the matter said on Monday (RT)

  • Intel will spend more than 30 billion euros ($33 billion) to develop two chip-making plants in Magdeburg as part of its expansion push in Europe, a deal Chancellor Olaf Scholz hailed on Monday as Germany's biggest ever foreign investment (RT)

Equity Raises

  • Luxury yacht maker Ferretti SpA’s main shareholder, China’s Weichai Group, is looking to raise about €268 million ($292 million) as part of a Milan stock offering as it pursues a dual listing (BBG)

  • Kodiak Gas Services said on Tuesday it is aiming for a valuation of about $1.65 billion in its U.S. listing, expecting to benefit from returning investor appetite for new offerings (RT)

Debt

  • Capital-hungry data centre business, AirTrunk, has mandated an army of investment banks to stitch together a whopping $4.76 billion sustainability-linked loan, expected to be the biggest corporate loan so far this year (AFR)

Daily Picks

  • Russia has threatened a strike against Kyiv’s “decision-making centres” if Ukraine uses western-supplied missiles against the occupied peninsula of Crimea, in the Kremlin’s latest attempt to inhibit Nato support for Kyiv amid the ongoing Ukrainian counteroffensive (Guardian)

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