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Good Morning,

Meta was fined over $1B by the EU, Biden and McCarthy are hoping to reach a debt ceiling deal soon, US firms are pulling forward bond deals amid debt ceiling concerns, PE firms are stepping up lending as banks pull back, and immigrants’ share of the US labor force keeps climbing.

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Let’s dive in.

Before The Bell

Markets

• Stocks closed mixed on Monday as Joe Biden and Kevin McCarthy prepared to resume debt-ceiling negotiations

• The dollar hit a 6-month high vs. the yen as investors increasingly expect US rates to remain higher for longer

• Oil prices increased to begin the week as investors expect a tighter market led by a seasonal rise in gasoline demand and supply cuts from OPEC+ producers

Earnings

• Zoom beat Q1 earnings with revenue increasing from $1.07B to $1.11B YoY thanks to growth in its enterprise segment and stabilizing revenue in its online segment (MW)

• What we're watching this week:

  • Today: Lowe’s, BJ’s Wholesales, AutoZone, Dick’s

  • Wednesday: Kohl’s, Nvidia, Snowflake, American Eagle

  • Thursday: Royal Bank of Canada, Best Buy, Dollar Tree, Ralph Lauren, Costco

  • Friday: Big Lots

• Full calendar here

Headline Roundup

• Biden, McCarthy try to get debt-ceiling deal done (WSJ)

• Treasury confirms US default as early as June 1 without debt ceiling hike (RT)

• US firms pull forward bond deals amid debt ceiling nerves (FT)

• TikTok sues Montana to reverse state’s ban of the app (CNBC)

• Pfizer oral weight loss drug may work as well as Ozempic (CNBC)

• The ACLU sued Florida over law banning Chinese citizens from buying homes (BBG)

• Meta fined a record $1.3B over EU user data transfers to the US (CNBC)

• ESPN, ABC are suddenly Disney’s weak link (WSJ)

• Japan’s factory activity expands for the first time in 7 months (RT)

• Private equity steps up lending as US banks pull back (RT)

• Ford announces key EV minerals deals ahead of crucial capital markets day (CNBC)

• Immigrants’ share of the US labor force grows to a new high (WSJ)

• Uber diversity chief suspended after events on race spark uproar (BBG)

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Deal Flow

M&A / Investments

• Television station operator Tegna has terminated its $8.6B acquisition by hedge fund Standard General due to regulatory hurdles (RT)

• Chevron is purchasing shale producer PDC Energy in a stock-and-debt deal valued at $7.6B (RT)

• KKR and InfraVia Capital Partners are competing to acquire French renewable project developer Akuo Energy in a deal that could value Akuo at over $3.2B (BBG)

• RenaissanceRe Holdings is buying almost all of reinsurance business Validus Re from AIG in a $3B cash and stock deal (BBG)

• Malaysian tycoon Syed Mokhtar Al-Bukhary is looking to sell a 30% stake in MMC Port Holdings in a deal that could value Malaysia’s biggest port operator at $2.7B (RT)

• Kennedy-Wilson Holdings purchased a real estate loans portfolio valued at $2.6B at a $200M discount from PacWest Bancorp, a regional lender seeking to survive the US banking crisis (RT)

• Finnish company Uponor rejected a $2.1B takeover bid from Belgian company Aliaxis, calling the offer inadequate (BBG)

• Abu Dhabi’s Mubadala and Fortress Investment Group agreed to buy 90% of Softbank’s stake in Fortress in a deal that could value the asset manager at over $2B (BBG)

• China’s energy giant State Power Investment Corp. is in advanced talks to acquire LatAm power producer Inkia Energy from I Squared Capital in potential $2B deal (BBG)

• NatWest Group agreed to buy back $1.6B of its shares from the UK government (BBG)

• The Brazilian billionaire family Moreira Salles offered to increase its stake in $1.4B Brazilian manufacturing company Alpargatas from 28.6% to 33% through its PE firm Cambuhy Investimentos and family office Brasil Warrant Gestao de Investimentos (BBG)

• Ironwood Pharmaceuticals will buy Swiss drug developer VectivBio Holding for $1.15B in cash (RT)

• Mizuho Financial Group is acquiring investment bank Greenhill for $550M (BBG)

• Blackstone is acquiring Fosun International’s stake in diamond-grading firm International Gemological Institute for $455M (BBG)

• Italian finance company Banca IFIS bought investment bank Mediobanca’s bad loan acquisition unit for $110M (RT)

VC

• Patient21, a four-year-old German startup that combines a digital healthcare platform with real-world brick-and-mortar clinics, has raised a $108M Series C led by Pitango (TC)

• Chalo, an Indian startup working to digitize bus commutes, raised a total of $57M: a $45M Series D led by Avataar Ventures and $12M in debt from Trifecta Ventures and Stride Ventures (TC)

• Axelera AI, a provider of AI solutions at the edge, expanded its total Series A funding to $50M with new investments from CDP Venture Capital, Verve Ventures, and Fractionelera, and an increased investment from Innovation Industries (FN)

• FlowX.AI, an AI enterprise application modernisation platform for large financial services organizations, raised a $35M Series A led by Dawn Capital (PRN)

• Peak Power, a cleantech startup providing energy optimization software and services, raised a $35M round led by Greenbacker Capital Management (FN)

• Westhill, an Atlanta-based tech company providing an end-to-end digital experience for managing property repairs, raised $13.5M in a funding round led by an unnamed large strategic investor with participation from existing investors Eos Venture Partners, Luge Capital, and NYCA Partners (FN)

• Volition, a startup building an ‘Industrial Parts Google’, raised $11M in funding co-led by Newark Venture Partners and Quiet Capital (TC)

• Australian clean tech startup Endua raised a ~$7.8M round from Queensland Investment Corporation, Melt Ventures, and 77 Partners (TC)

• Drug discovery startup PharmEnable raised a $7.5M pre-Series A led by MP Healthcare Venture Management (FN)

• VARK, a virtual live music event platform, raised a ~$7.2M Series C from SBI Investment, NetEase Games, and more (BW)

• Medical imaging startup LEADOPTIK raised a $5M seed round led by MetaVC Partners (PRN)

• Kiwi, a fintech startup helping consumers build credit, announced that it closed a $4.5M pre-series A funding round led by Advent-Morro Equity Partners, Altio Capital, and Independent Capital (BW)

• Jia, a blockchain-based fintech providing loans to micro and small businesses in emerging markets, raised a $4.3M seed round led by TCG Crypto (FN)

• Jotelulu, a Madrid-based provider of a platform that helps companies transform into cloud service providers, raised a $4.3M round led by Adara Ventures (FN)

• Sort, a platform simplifying Web3 app development, raised a $3.5M seed round co-led by Lemniscap and The General Partnership (PRN)

IPO / Direct Listings / Issuances / Block Trades

• A consortium led by Partners Group is exploring a sale or IPO of Germany’s Techem, which could value the metering company at up to $8.6B (BBG)

• Abu Dhabi National Oil upsized the IPO of its logistics unit from 15% to 19% of the company, allowing it to raise up to $769M (RT)

SPAC

• Unifund Financial Technologies is merging with Everest Consolidator Acquisition in a $238M deal (SN)

Crypto Corner

• The Philippines’ SEC warned investors that crypto trading platform Gemini has been operating in the country without proper authorization (BBG)

• Malaysia’s SEC ordered crypto exchange Huobi Global to cease operations in the country due to its lack of registration (WSJ)

• South Korea will vote on bill requiring its public officials to disclose all digital asset holdings that exceed ~$760 (CT)

Exec’s Picks

• Financial Times covered Carl Icahn’s ill-timed short bet over the last six years.

• Byrne Hobart covered everything you need to know about Cava’s upcoming IPO.

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