All (Stock) or Nothing

All-stock M&A is at a multi-decade high, quant firms are breaking into fixed-income markets, Goldman expects buybacks to fuel a stock rally, Wall Street bonuses are expected to rise, and Gen Z is brewing an unhealthy relationship with credit cards.

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Litquidity Capital
May 08, 2024

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Good Morning,

All-stock M&A is at a multi-decade high, quant firms are breaking into fixed-income markets, Goldman expects buybacks to fuel a stock rally, Wall Street bonuses are expected to rise, and Gen Z is brewing an unhealthy relationship with credit cards.

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Let’s dive in.

Before The Bell

As of 05/07/2024 market close.

Markets

  • US stocks closed mixed yesterday as the recent market recovery cooled

    • The S&P's four-day win streak is its best since March

    • The Dow's five-day win streak is its best since December

  • Copper again briefly hit $10k/ton

Earnings

  • Walt Disney beat Q2 earnings on narrowing streaming losses but forecast weakness in its entertainment D2C unit causing shares to fall ~10% (CNBC) 

  • Reddit jumped ~14% after beating Q1 revenue estimates and forecasting better-than-expected Q2 revenue on recovering digital advertising (CNBC) 

  • Rivian fell ~6% after reporting a wider-than-expected Q1 loss and reiterating FY production forecast well below analyst estimates (RT) 

  • What we're watching this week:  

    • Today: Uber, Toyota, Airbnb, Shopify, Robinhood

    • Thursday: Warner Bros Discovery

  • Full calendar here

Headline Roundup

  • Dealmakers eye all-stock deals as US rate cut hopes fade (RT)

  • Wall Street bonuses expected to rise as deals return (RT)

  • Companies are seeing best earnings since 2022 (YF)

  • Gen Z is leaning hard on credit cards (WSJ)

  • PE to soon be allowed to buy up to 30% stakes in NFL teams (BBG)

  • Goldman expects buybacks to drive stocks higher in Q2 (BBG)

  • Quant firms seek to get in on bond markets (BBG)

  • JPMorgan, CICC, Citic, cut IB jobs in China as deals stall (RT)

  • PwC and EY hit with fines over LCF audit failures (FT)

  • ETF manager WisdomTree facing a new proxy fight (FT)

  • Goldman named ex-Dallas Fed chief Kaplan as vice chairman (RT)

  • Fitch downgraded NYCB to 'BB' (RT)

  • Investigation finds rampant sexual harassment, discrimination at FDIC (WSJ)

  • US revokes export licenses for chips to Huawei (FT)

  • Uber's european rival Bolt is expanding in US (BBG)

  • Panera discontinued 'charged' drinks (BBG)

  • TikTok sued to block US's divest-or-ban law (BBG)

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Deal Flow

M&A / Investments

  • US backed Colorado’s bid to block supermarket giant Kroger’s $24.6B acquisition of Albertsons (BBG) 

  • Brazilian pulp and paper company Suzano approached US-based International Paper to express interest in a ~$15B all-cash acquisition (RT) 

  • Germany’s largest electricity producer RWE is considering options for its minority stake in transmission operator Amprion which could be worth $1.7B (RT) 

  • Oil and gas producers Santos and Repsol are exploring a minority stake sale of Alaskan oil fields they jointly operate in a deal potentially worth ~$1B (RT) 

  • KKR will buy Australian money manager Perpetual’s name and corporate trust and wealth management businesses in a $990M deal (BBG) 

  • Chinese state-owned conglomerate China Merchants Group is in advanced talks to acquire a 40% stake in telecom group PCCW's fiber unit for $850M-$900M (BBG) 

  • BigCommerce, a $532M e-commerce software maker, is exploring a sale after attracting takeover interest (RT) 

  • Sri Lankan conglomerate Browns Group will buy CVC's troubled Kenyan tea estates it acquired from Unilever in 2021 (FT)

  • Exercise equipment company Peloton received PE takeover interest (CNBC) 

VC

  • Cloud security platform Wiz raised a $1B Series E at a $12B valuation led by a16z, Lightspeed Venture Partners, and Thrive (TC)

  • Stonal, an AI proptech platform for real estate, received a $107M investment from Aeron (FN)

  • TXOne Networks, a cyber-physical systems security startup, raised a $51M Series B extension led by TGVest Capital (BW)

  • Legion Technologies, a workforce management startup, raised a $50M round led by Riverwood Capital (TC)

  • Property and casualty insurance startup Honeycomb Insurance raised a $36M Series B led by Zeev Ventures (TC)

  • Daloopa, an AI startup automating financial analysts' workflows, raised an $18M Series B led by Touring Capital (TC)

  • Nudge Security, a SaaS security and governance provider, raised a $16.5M seed round led by Forgepoint Capital (PRN)

  • Neurable, a neurotech democratizing BCI technology, raised a $13M round from Ultratech Capital Partners, TRAC, and more (BW)

  • AI-powered accounting automation startup Numeric raised a $10M seed round from Founders Fund, Menlo Ventures, 8VC, and more (PRN)

  • PAXAFE, a B2B software for supply chain risk management, raised a $9M Series A led by Framework Venture Partners (PRN)

  • Niobium, a custom silicon provider, raised a $5.5M seed round led by Fusion Fund (PRN)

  • Data visualization startup Electricity Maps raised a $5.4M round from Transition and Revent (TC)

  • Egyptian corporate cards platform Swypex raised a $4M seed round led by Accel (TC)

  • DwellFi, an AI and blockchain solutions for private funds, raised a $3M seed round led by E1 Ventures, Stanford Blockchain, and more (FN)

IPO / Direct Listings / Issuances / Block Trades

  • Thai drinks maker General Beverage is planning a $222M Singapore IPO of its international distribution unit IFBH (BBG) 

Debt

  • Guggenheim Partners is talking to lenders including private credit firms to gauge interest in financing Arkhouse and Brigade's potential $6.6B buyout of Macy’s (BBG) 

  • CVS Health will raise $5B through a five-part bond sale (BBG)  

  • Brazilian sustainable OSV developer Compagnie Maritime Monegasque raised $94M in financing led by Summit Ridge (PRN)

Bankruptcy / Restructuring

  • Bankrupt Steward Health Care put all 31 hospitals up for sale and disclosed $9B in debt (RT) 

Fundraising

  • Max Altman-led seed-stage Saga Ventures raised a $125M fund to back software startups (FRB)

Crypto Corner

  • Binance was asked for a large payment in Nigeria to make its problems 'go away' (BBG)

  • German state-owned development bank KFW will sell its first blockchain-based digital bond (BBG) 

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