Together with

Good Morning,

The FTC sued Amazon for anti-competitive practices, OpenAI may be selling shares at a ~$90B valuation, McKinsey is paying $320M to settle more opioid lawsuits, the CIA is building an AI tool, China’s industrial profits continue to decline, and Target is closing multiple stores due to violence and theft.

Looking to diversify your portfolio with alternative assets? You can gain access to private credit deals through today’s sponsor, Percent!

Let’s dive in.

Before The Bell

Markets

• US stocks plunged in their worst day since March after August homes sales and consumer confidence came in worse-than-expected, stoking fears over the US economy

  • The Nasdaq led indices with a 1.57% decline

• Asian stocks fell over concerns about higher US interest rates and a Chinese economic slowdown

Earnings

• Costco beat fiscal Q4 analyst expectations for both adjusted earnings and revenue, but investors want to see a membership fee increase (BRRN)

• What we're watching this week:

  • Today: Micron Technology, Jefferies

  • Thursday: Nike, Accenture, BlackBerry

  • Friday: Carnival Corporation

• Full calendar here

Headline Roundup

• FTC sues Amazon in landmark antitrust case over marketplace (BBG)

• McKinsey agrees to pay $320M to settle more opioid suits (BBG)

• Biden stands with striking UAW autoworkers in Michigan, supports big pay raise (CNBC)

• World’s mega-rich are betting on US renters to grow their billions (BBG)

• 3M being investigated in Belgium over forever chemicals emissions (WSJ)

• BOJ’s July debate highlights rift in view on rate hike timing (RT)

• CIA builds its own artificial intelligence tool in rivalry with China (BBG)

• Private equity’s slow carnage unleashes a wave of zombies (BBG)

• Apple’s Eddy Cue defends default search contract with Google as best option for consumers (CNBC)

• China’s industrial profits extend slump for Jan-Aug, but pace of downturn eases (RT)

• ArcelorMittal CEO sees global steelmakers buoyed by China output limits (BBG)

• Target says it will close nine stores in major cities citing violence and theft (CNBC)

• Canada lifts mortgage bond plan by 50% to boost construction (BBG)

• Kevin McCarthy stares down GOP holdouts in critical shutdown vote (WSJ)

A Message From Percent

Looking for performance? Consider private markets

If your portfolio is focused on publicly-traded stocks and bonds, you may be leaving opportunities on the table.

Over 90% of companies are privately held, including some of the world’s largest companies such as Lego, IKEA and Publix. To find funding, these companies turn to private markets (aka private credit). These private credit deals typically have yields that exceed benchmark rates and the potential for ongoing cash flow.

For years, institutional investors have used private credit as a secret weapon to boost portfolio performance. Now you can too. Percent makes private credit investing available to retail accredited investors for as little as $500. Amp up your portfolio with:

• High APY: average of 18.55% as of August 31, 2023

• Shorter-term durations: from 9 months or less to several years, depending on investment goals

• Welcome bonus: earn up to $500 bonus on your first investment

• Diversification: access to small business lending in Latin America, Canadian mortgages, US merchant cash advances, and more

Visit Percent to create a free account and see all current offerings available.

Deal Flow

M&A / Investments

• EU regulators have paused their investigation into Adobe’s $20B acquisition of cloud-based designer platform Figma while they wait for requested information (RT)

• PE firms GTCR and Apax Partners are exploring options including a full or partial sale of insurance broker AssuredPartners, which could be valued at up to $16B, including debt (BBG)

• US agribusiness company Bunge’s $8.2B acquisition of Glencore-backed Viterra will undergo a public review in Canada to assess its transportation impact on Canadian farmers (BBG)

• Billionaire Jim Ratcliffe is restructuring his offer to acquire Premier League team Manchester United, which the Glazer Family is looking to sell for at least $7.3B (BBG)

• French PE firm PAI Partners is weighing a sale of Apleona Group that could value the German facilities manager at ~$4.3B (BBG)

• Brookfield Asset Management and Thomas H. Lee Partners are among suitors making final bids for pipeline inspector Rosen Group, which could be valued at as much as $4B (BBG)

• PE firm New Mountain Capital’s health-plan administrator HealthComp and Marlin Equity Partners’ digital-wellness platform operator Virgin Pulse plan to create an all-in-one health-tech platform through a $3B merger (WSJ)

• Icon Infrastructure is nearing a possible $1B deal to acquire South African hospital operator Life Healthcare Group Holdings’ UK diagnostics business Alliance Medical Group (BBG) 

• Investment firm Wren House Infrastructure is in talks to acquire a 49% stake in SeaCube Container Leasing from Ontario Teachers’ Pension Plan, which could value the cargo-equipment company at as much as $1B (BBG)

• Italian pharmaceutical company Alfasigma will acquire US drugmaker Intercept Pharmaceuticals for $794M (RT)

VC

• Sierra Space, a startup building a commercial space station, raised a $290M Series B at a $5.3B valuation led by MUFG, Kanematsu Corporation, and Tokio Marine & Nichido (TC)

• Adela, a Foster City, CA-based company that specializes in blood testing for monitoring and detecting cancer, raised a $48M round from F-Prime Capital, OrbiMed, and more (FN)

• Atrial fibrillation therapeutics developer Acesion Pharma raised a $47.5M Series B led by Canaan and Alpha Wave (PRN)

• Series, a startup aiming to replace ERP systems, raised $25M across seed and Series A rounds led by 776 and Basis Set Ventures (TC)

• Pexapark, a Zurich-based energy investment platform, raised a $21.1M Series C led by Telstra Ventures (EU)

• Cartwheel, a telehealth platform helping schools provide mental health services, raised a $20M Series A led by Menlo Ventures (PRN)

• Ayro, a Paris-based manufacturer of wingsails for cargo ships / yachts, raised a $20M Series B led by Blue Ocean (FN)

• LOGE Camps, a lodging brand that enables travelers to interact with the outdoors, raised $16M in financing from DCA Family Office (PRN)

• Kolena, a startup building tools to test and benchmark AI models, raised $15M in a funding round led by Lobby Capital (TC)

• Linux cybersecurity solutions provider Vali Cyber raised a $15M seed round led by Grotech Ventures and the 412 Venture Fund (BW)

• QT Medical, a medtech company focused on cardiac care, raised a $12M Series B led by CDIB Capital and Taiwania Capital (PRN)

• Workplace surveillance startup Erudit raised a $10M Series A led by Conexo Ventures, Athos Capital and more (TC)

• Customer voice platform UserEvidence raised a $9M Series A led by Crosslink Capital (BW)

• Fhenix, a provider of a blockchain powered by homomorphic encryption, raised a $7M seed round led by Multicoin Capital and Collider Ventures (FN)

• Digma, a continuous feedback platform for developers, raised a $6M round led by at.inc (FN)

• Meeno, a relationship mentoring app, raised a $5M seed round led by Sequoia (FN)

IPO / Direct Listings / Issuances / Block Trades

• OpenAI is in talks to hold a secondary share sale at a ~$90B valuation (WSJ)

• Birkenstock is preparing to kick off its investor roadshow for its US IPO next week; the footwear maker is considering seeking a $10B valuation (BBG)

• Schott Pharma is expected to price its shares at $28.53 each in its IPO in Frankfurt, implying a $4.2B valuation for the German medical vials manufacturer (RT)

• Books for the IPO of Renk are fully covered, including the greenshoe option; the German defense contractor will have a valuation of up to $1.9B (RT)

• Cainiao Smart Logistics Network, the logistics arm of Alibaba, filed for a Hong Kong IPO worth at least $1B (BBG)

Debt

• Citibank raised $5B through a three-part sale that included both fixed and floating rate notes (BBG)

• Adani Ports and Special Economic Zone will buy back as much as $195M of its notes due 2024 (BBG)

• India's National Bank for Agriculture and Rural Development raised $125M through the country’s first social impact bond (RT)

Bankruptcy / Restructuring

• Scandinavian airline SAS is evaluating final bids in an equity fundraising, which is part of an ongoing bankruptcy protection process (RT)

Fundraising

• Wells Fargo and PE firm Centerbridge Partners are partnering for a direct lending fund that will target at least $5B (BBG)

• PE firm Paine Schwartz Partners raised $1.7B for Paine Schwartz Food Chain Fund VI to invest in the food and agribusiness sector (WSJ)

• ECI Partners, a UK growth-focused middle-market PE firm, closed its 12th buyout fund, ECI 12, at $1.2B (FN)

• Distressed debt specialist Michael Sutton is teaming up with former Deutsche Bank colleague Alex Malinor to launch Alinor Capital Management, a distressed debt hedge fund likely to raise over $500M (BBG)

Crypto Corner

• JPMorgan’s UK retail bank Chase will ban crypto transactions made by customers from Oct. 16 due to an increase in fraud and scams (RT)

• Bitcoin bull Michael Saylor’s MicroStrategy bought $150M worth of additional Bitcoin (BBG)

• US bankruptcy court approved crypto lender BlockFi’s liquidation plan (CT)

Exec’s Picks

• Tegus Converge 2023 is your chance to catch up on the latest trends in investing, from Generative AI and idea generation to best practices for compliance and more. Register today.

• Rob Price interviewed several folks, including Exec Sum’s editor Jack Raines, to explain how LinkedIn got so weird.

• In Forbes’ cover story on Mark Zuckerberg, the tech founder discusses everything from getting punched in the face to AI developments.

Litney Partners - Financial Recruiting 💼💼

If you're currently a junior investment banker looking to break into the buy side, considering lateraling to another investment bank, or have recently been impacted by widespread layoffs, it's time you check out Litney Partners, a partnership between Litquidity and Whitney Partners (the oldest purely financial services executive search and consulting firm).

We aim to place strong candidates at leading private equity, hedge fund, venture capital, growth equity, and credit funds, as well as investment banks.

To get started, simply head over to the Litney website and create your profile by dropping your resume / filling out the form:

Meme Cleanser

Advertise with us // Visit our merch store // Invest alongside Lit Ventures // Book a call with Lit // Launch your own newsletter