One deep dive to start: since its £ 856 million listing in London, Alphawave is still the UK’s most valuable business in the semiconductor sector. But for a fast-growing business that is now worth billions of pounds, its key customers seem a little too close to home, as Jamie Powell of the FT and Rob Smith of DD investigate this Alphaville Post. The company’s shares more than halved after it has been published.
– Robert Smith (ondBondHack) 29 September 2021
The elite American law firm specializing in corporate crises
If allegations of misconduct threaten the business and brand of a business and increase the actions of the government, businesses and boards of directors turn to Paul, Weiss, Rifkind, Wharton & Garrison.
DD did not get that sentence: it’s lawyer advertises, which we literally removed from the website of one of the most prestigious law firms in America.
Such a pitch may be the reason why online media management starts Ozy rented Paul, Weiss this week, shortly after The New York Times reported that the co-founder of the company considers himself a Youtube CEO in an apparent attempt to attract investment Goldman Sachs.
Or maybe the Ozy board was simply impressed with the firm’s credentials chair Brad Karp.
Since starting as a summer employee, Karp has become one of the country’s leading corporate advocates.
He also earned a reputation as a crusader in the courtroom for social justice. The “deep human dimension in this fight to uphold the rule of law”, he said, while accepting a coveted award in 2019, “should not be lost”.
Yet, the work that Paul, Weiss does for corporate clients requires pragmatism as often as profound.
According to its website, the firm’s advice has helped the world’s most prominent businesses. . .[to] avoid large-scale regulatory actions and limit exposure to law and reputation ”.
It’s not a rising rhetoric, but this counter seems to have won impressive customers.
fox rented Paul, Weiss to investigate allegations that his star is anchored Bill O’Reilly harassed several women. (O’Reilly denied the allegations. He was later taken off the air and received a large payout.)
Swiss credit rented Paul, Weiss to a 165-page report in its financially devastating relationship with the troubled investment group Archegos Capital Management. (The lawyers identified a ‘failure in management’, but ‘ultimately … no evidence of fraud’.)
And BlackRock has rented Paul, Weiss to investigate reports of ’employee misconduct’ to the FT and other publications detailed assertions of discrimination and sexual harassment at the world’s largest asset manager.
Of course, it often happens that the allegations that Paul, Weiss is hired to investigate appear to be unfounded.
Consider the case of Apollo Global Management, a longtime client who hired Karp’s firm in 2012 to look after possible irregularities in its expenditure system.
An Apollo partner, who was later fired, repaid $ 290,000 to Apollo investors. But Apollo itself discovered that it had underpaid investors worth $ 370,000.
The last showdown in a £ 10 billion bid war
After months of bickering over control of UK supermarket chain Wm Morrison, an auction the weekend will determine the winner.
The £ 10bn trade-off fits the private equity firm Clayton, Dubilier & Rice against the Soft bank-owned Fortress Investment Group, which is best known for its bets in the distressed debt market.
The showdown comes down to the most popular auction in the British takeover arena since Comcast and Disney fought it for the control of the pay-TV broadcaster Heaven. For those interested in the exact mechanics of this weekend’s auction, go here.
As we have already explained in DD supermarkets in the UK hold a strange psychological grip on the country and its newspapers.
Based on media coverage alone, you would be forgiven if you thought Morrisons was more than just the fourth largest grocery store chain in the UK through sales with a less than ambitious online footprint compared to its competitors. Although she new partnership with Deliveroo may indicate efforts to modernize the group and keep pace with the boom in ‘fast’ grocery delivery programs.
Both PE businesses now want to offer more than a 60 percent premium on the undisturbed share price of the business. (This includes debt, which means any deal for Morrisons will cost the company more than £ 10bn.)
We are used to seeing the kind of numbers for a warm start with biotechnology, not a neighborhood store popularly referred to by Brits as “Mozzas”.
For some, the saga highlighted how a mismatch between the value of shareholders in the public market is attributed to what private market investors are willing to pay.
But DD wonders whether this deal will be remembered as the culmination of a dry powder-powered private stock bubble that will soon burst, and the macroeconomic backdrop begins to darken.
Check out the scrap of private shares unfolding in Germany for the online pet retailer ZooPlus. The Swedish buyout firm EQT the top his opponent Hellman & Friedman with an offer valuing a 69 percent premium.
There is something seriously inefficient with public markets, or the private equity venture has stimulated too much.
However, like most transaction dramas, it is important to remember that the real winners of a takeover battle are the bankers, lawyers and other advisers.
Late last week, Morrisons released its shareholder documents on the current recommended offering of CD&R. As you can see from the picture above, advisers and financiers working with CD&R will take on more than £ 300 million in housing.
The leadership of the pack is Anthony Gutman at Goldman Sachs, whose bank is likely to take up a large portion of the deal’s financing JPMorgan Chase. We also take note of the neat piece of change that has gone to the people Teneo which handles media and public relations for CD&R. We previously covered the fees for the fortress camp here.
The stage is set for Saturday at 5pm UK time. You can only imagine how frustrated the losing camp would be.
Are venture capitalists the new financial engineers?
General catalyst has a record for predicting the next big thing.
The Cambridge-based venture capital heavyweight division came to the fore early in some of the hottest technology ventures, including Stripe, Airbnb and Lemonade. The last victory was on Wednesday after the rising public debut of the spectacle group Warby Parker, which has been investing it for almost a decade ago.
So DD is wondering if it will catch up with its latest effort: Structured Opportunities, a new line of financial engineering in which it buys sales contracts from tech companies to gain a share of their future revenue streams.
The venture capital firm aims to raise up to $ 300 million for its first structured opportunity fund, and has already started making investment offers out of the strategy, one person informed told DD’s Miles Kruppa.
As it turns out, General Catalyst is not the only company trying this strategy.
A new range of new businesses has emerged that enables businesses to pre-sell rights on their revenue streams at discounted prices. They contain groups such as Capchase and Pipe.
If the business model sounds a bit familiar, you might think about it Greensill Capital, the SoftBank-backed group that allowed companies to forward their invoices and exploded spectacularly earlier this year.
General Motors CEO Mary Barra was named the first female chair of the non-profit group Business Round Table, pass Walmart head Doug McMillon.
Freshfields Bruckhaus Deringer rented it Damien Zoubek as its new co-head of American Enterprises and M&A, based in New York. Zoubek, a partner at Cravath, Swaine and Moore since 2007, is the latest star trader to transition from competitor to competitor talent war between elite American and British enterprises.
The billionaire Patrick drahi stripped it BNP Paribas veteran Laurence Beghin to lead investments in Next Alt, Drahi’s personal investment vehicle, by Bloomberg.
Fasten the shutters A lawsuit by Italian ferry operator Moby has accused two of Morgan Stanley’s biggest debt dealers of entering into a secret agreement with an investor to gain control of the business, away from other creditors. (Bloomberg)
Burden of proof From a small Texas court, U.S. Federal Judge Rodney Gilstrap set an interesting record: the largest number of cases involving businesses in which he or a family member had a financial interest. (Wall Street Journal)
Hassle-free happy hour A move towards low-alcohol and zero-resistance spirits threatens to leave the liquor industry high and dry if businesses do not adapt to the evolving tastes of sober-curious youths. (FT)