FT : Insead tops FT European Business Schools Ranking for the first time

Insead tops FT European Business Schools Ranking for the first time
The annual assessment is based on schools’ performance across multiple programmes

Insead has topped the FT’s European Business Schools Ranking for the first time, jumping sharply from its position last year.

The French school, which has campuses near Paris and in Singapore, rose from 18th place in 2023, overtaking past winners HEC Paris and London Business School, which were pushed into second and third place respectively.

Insead had previously ranked as high as second in 2011 and third in 2021, but this was the first time the school’s position was based on all programme categories in the composite European ranking.

The assessment takes into account the relative performance of European business schools across a range of programmes that feature in separate global FT rankings each year: Masters in Management, MBA, Executive MBA and open and custom executive education courses. The European ranking is weighted to compensate, partly, for any schools that do not offer all five options.

The individual rankings are based on factors including salaries of alumni three years after completing their course, career progression, the research outputs of faculty and the diversity of staff and students.

European schools continue to stand out against rivals in North America and Asia for their pioneering role in developing the Masters in Management programme, for the high representation of women and international diversity of students and faculty, and for their work on sustainability.

However, the ranking comes at a time of tensions, with rising overall applications offset by stagnation in numbers of students globally taking up offers of places, and concerns that a number of countries including within the EU and the UK are clamping down on visas for international students.

The UK has been particularly hit since Brexit affected growth and reduced the scope for employment after graduating across the EU. Two-thirds of British business schools reported falling applications, according to the latest survey by GMAC, which administers the GMAT business school entry test. Median class sizes fell from 90 in 2023 to 68 this year.

The ranking comes at a time of tensions, with rising applications offset by stagnation in numbers of students globally taking up offers

A significant number of Asian students are remaining in their own region to study, while the US is expanding its competitive threat to Europe’s historical dominance of pre-experience, lower-cost, one-year masters in management programmes. The economic strength of the US continues to attract students from abroad, compared with more sluggish growth in the EU.

However, David Bach, the new president of IMD in Switzerland, says: “Europe’s undeniable strengths in competitiveness, talent, sustainability and innovation can, when integrated within a unified capital market, radically transform its economic trajectory.”

Insead ranks top among European business schools overall, as well as for both its signature MBA programme and custom executive education courses tailored to the needs of corporate clients, where it is placed ahead of Iese of Spain and IMD. Besides Fontainebleau and Singapore, the school also has offices in Abu Dhabi and San Francisco.


The dozen top schools in the European ranking all specialise exclusively or primarily in business, although Bocconi in Italy and the University of St Gallen in Switzerland both offer other degrees, such as law. Saïd Business School in Oxford, ranked 13th, is a far more recent addition to a university founded nearly 1,000 years ago.

Among the ranked schools, 88 have fewer female than male faculty, with just four employing equal numbers and an average for all institutions of 37 per cent women. The highest is 57 per cent at Essca School of Management in France, while Germany’s HHL Leipzig Graduate School of Management and the University of Zurich in Switzerland score lowest at 17 per cent each.

IMD, in Lausanne, has the most internationally diverse faculty, with 98 per cent holding other citizenships. The average is 53 per cent, with University of Porto — FEP | PBS the least diverse, with 1 per cent of faculty from overseas.

Once adjusted for international purchasing power parity, alumni of the Executive MBA at Koç University’s Graduate School of Business in Turkey earn most among graduates of a single-school EMBA in the European ranking, at an average reported salary of $379,000 a year. They are followed by those at ESCP, which has six campuses across Europe, and Skema of France. Alumni of the Trium joint Executive MBA run by HEC Paris, NYU Stern and LSE — one of two EMBAs contributing to HEC’s European placing — reported earning an average of $421,699.

Among MBA alumni, Bocconi graduates come top for salaries, with a mean of more than $202,000, ahead of Insead and London Business School. The biggest reported salary increase is for alumni of Esade, up by 151 per cent from before the degree to three years after completing it.

For Masters in Management programmes, St Gallen of Switzerland was top overall, ahead of HEC Paris and Insead. Alumni of HHL Leipzig Graduate School of Management and St Gallen both reported average salaries above $140,000. The biggest salary increase was for graduates of Luiss in Italy, followed by Católica Porto Business School in Portugal and IQS — Universitat Ramon Llull in Spain. 

>>> Barrons Weekend Summary

Cover:
-President-elect Donald Trump has promised tax breaks for everyone on his campaign list, including averting income-tax rate increases and eliminating taxes on tips and Social Security income. However, with the Republican majority in both the Senate and House, it will be nearly impossible to make good on all promises, as the revenue loss for the federal government is estimated at $9T if all proposed changes are adopted. Experts say implementing some ideas may not be feasible. The outlook for middle- and lower-income taxpayers is less certain, with Trump's win potentially leading to small improvements or even declines in after-tax income. Trump has also been discussing issuing a 60% tariff on imported Chinese goods and a 10% or 20% tariff on imports from anywhere else, which could raise a net $2.8T or $4.5T for federal coffers over 10 years.

Interview:
-American agricultural abundance has been declining, and agricultural economist Dan Basse spoke to Barron’s, expressing his concern that the decline of globalization and the economic and political rift between the US and China may put US farmers at the losing end. The split between the G-7 countries and the BRICs, which includes Brazil, Russia, India, and China, may result in differing trade patterns that disadvantage US farmers. Basse, founder of AgResource, grew up on a Wisconsin dairy and grain farm and started in the agriculture commodities business in 1979. He discusses the impact of geopolitics on US farmers, food inflation, and the future of agriculture.

Tech Trader:
-The artificial-intelligence boom, fueled by the launch of ChatGPT, has led to a spending war between Microsoft, Google, Amazon.com, Meta Platforms, and others to source chips from Nvidia and other companies. However, the competition could change as the industry faces obstacles in building larger AI models. Nvidia has been the chief beneficiary of the spending race, as its graphics-processing units (GPUs) are particularly good at carrying out multiple calculations simultaneously, significantly reducing the time required to train a model. The scaling law, which measures the size and complexity of AI models, is now facing questions. Microsoft CEO Satya Nadella has defended the topic, stating that it's good to have some skepticism and debate to motivate innovation. If AI improvement breaks down, current leaders, including Microsoft, Google, Amazon, OpenAI, and Nvidia, could face new concerns about their big spending. As a result, prominent AI figures are pushing back on scaling doubts.

The Trader:
-Healthcare stocks have been attracting investors due to concerns about the future of vaccines and weight-loss drugs. Donald Trump's nomination of Robert F. Kennedy Jr. and other healthcare skeptics has caused investors to flee the sector, prompting a close look at the stocks. The S&P 500 has seen a 5% increase in November, while healthcare stocks have fallen about 2% this month. BofA Securities' latest fund flow data report showed that clients were net buyers of equities for the third week in a row, with inflows accelerating to their highest level since September. However, healthcare ETFs were the only sector ETFs that BofA's clients were avoiding. Healthcare stocks saw their first outflows in five weeks, one of only two sectors, along with real estate, to experience net selling. The incoming Trump administration could make policy changes and potential appointees, such as Dave Weldon and RFK Jr., could be wild cards due to their rejection of scientifically accepted facts (sic). Wall Street's aversion to uncertainty may keep them out of favor in the near term. However, healthcare stocks are trading cheaply enough to start looking interesting.
-November saw the S&P 500 reach its 53rd record close of the year, with the Dow Jones Industrial also reaching its 47th record close. The S&P 500's year-to-date gain at 26.5% was the least impressive of the major indexes, with the NASDAQ Composite being the least impressive. The post-election euphoria has given way to a more pragmatic analysis of how changes in Washington may shake out, but Inauguration Day is still far enough away not to cause too much worry. For now, there seems to be little to stop a year-end Santa Claus rally. Good data marches on, with initial jobless claims falling more than expected to a seven-month low, and the Bureau of Economic Analysis's second-quarter estimate for real gross-domestic-product growth in the third quarter at 2.8% matched expectations. JP Morgan's head of global markets strategy, Dubravko Lakos-Bujas, predicts the US will remain the global growth engine with the business cycle in expansion, healthy labor market, broadening of artificial-intelligence-related capital spending, and prospect of robust capital market and deal activity.

Features:
-Applied Therapeutics' stock fell 73% to $2.33 on Friday, wiping out $730M in valuation. The biotech company received a letter from the FDA stating that the agency declined to approve a drug for treating the metabolic disorder Classic Galactosemia. The FDA cited "deficiencies in the clinical application" of the drug, which it's marketing as govorestat. Founder and CEO Shoshana Shendelman expressed disappointment with the FDA's decision and said she would work with the FDA to address the concerns raised in the letter. As of Wednesday's close, shares in Applied Therapeutics were up 135% in 2024, but Friday's losses have put them in the red for the year.
-President-elect Donald Trump is planning to raise tariffs on imports, even those from the US's closest trading partners, due to the controversial nature of such moves. The last time the US introduced sweeping taxes on imports was in 1930's Smoot-Hawley Tariff Act, which raised tariffs on thousands of goods to historically high levels. This did not help the country out of the Great Depression, as other nations retaliated and international trade was drastically reduced. The Dow Jones Industrial Average fell 40% in the year after it was passed. Markets have not responded badly to Trump's promises to levy more taxes on goods from China, Canada, and Mexico, with the Dow up more than 6% over the past month. Tariffs and protectionism were common wisdom in the past, as they were seen as damaging when trade deficits increased competition for domestic companies.

Europe:
-European markets were boosted by a surge in chip stocks, with the Stoxx 600 index jumping 0.6% in early trading. Paris' CAC 40 climbed 0.7%, easing concerns about budget infighting potentially threatening France's government. Frankfurt's Dax was up 0.7%, and London's FTSE 100 edged up 0.2%. The Biden administration is considering imposing more restrictions on semiconductor sales to China, but the measures are expected to be less harsh. Dutch chip equipment manufacturers' shares rose, with ASML up 4.1%, ASM International up 3.3%, and BE Semiconductor Industries up 4.4%. In Asia, Chinese stocks fell as investors waited for news about more stimulus for Beijing, which has struggled to restart the world's second-largest economy this year. Hong Kong's Hang Seng Index fell 1.2%, while the mainland CSI 300 was down 0.9%. Japanese equities had a better day, with the benchmark Nikkei 225 closing 0.6% higher. US stock and bond markets are closed for Thanksgiving, but futures tracking the S&P 500, NASDAQ 100, and Dow Jones Industrial Average indexes ticked up.

Emerging Markets:
-No update

Commodities:
-Over the past 15 years, oil drillers have transformed the Permian Basin in Texas and New Mexico into the most important oil basin in the world by re-engineering pipes and applying pressure and chemistry. Now, they are tapping into artificial intelligence to keep the crude flowing for decades more. AI can help oil companies extract more oil than it is equivalent to adding the output of an entire Middle Eastern nation. Over the past decade, the US pumped out 60% more oil a day with 40% fewer workers, outpacing even those of online retailers. By extracting more oil while reducing capital expenses and manpower, they are lowering the costs at which they can drill profitably. In the Permian, the "break-even" price for oil producers has fallen to $40 a barrel from over $90 in 2012, according to S&P Global Commodity Insights. AI should take that number even lower, boosting oil company margins and cash flow. For the top Permian producers—Exxon Mobil, Chevron, Diamondback Energy, EOG, and Occidental Petroleum—all of the extra cash they're generating through efficiency gains should keep their dividends secure and growing, even during oil price slumps. Some of those stocks now yield over 4%.

Streetwise:
-The recent price gains in financial markets, particularly in Tesla and Bitcoin, are threatening to undermine the company's impressive performances. Wedbush Securities analyst Dan Ives explains that President-elect Donald Trump is likely to scrap rebates and tax breaks for electric vehicles, giving Tesla a clear competitive advantage. Tesla's fast-tracked autonomous strategy, which is expected to be worth a $1T valuation alone to the Tesla story over the coming years. For Bitcoin, Trump's use of the currency to buy burgers for crypto bros at a Manhattan bar has piqued appetites, demonstrating the belief that a Donald Trump presidency and likely Republican-controlled Congress provides significant support for regulatory clarity in the US and greater crypto activity and adoption. Bitcoin has outshone Ethereum to the point where the ratio of the two prices has hit key levels of previous support.
One notable example of this valuation analysis is Peanut the Squirrel, an orphaned New York City critter that became famous on Instagram and became a symbol of government overreach. A Peanut cryptocoin has hit a market value of over $1B, highlighting the potential for significant market gains in the future.

WWD : Alexis Mabille Seeks New Investors Amid Financial Restructuring

Alexis Mabille Seeks New Investors Amid Financial Restructuring
The brand is seeking to reduce its debt and raise funds, with the aim of relaunching its ready-to-wear and accessories lines.

PARIS — Alexis Mabille is seeking new investors as it works to raise fresh funds and renegotiate its debt, with the aim of relaunching its ready-to-wear and accessories lines within the next three years.

The French haute couture brand’s operating company Impasse 13 has gone into receivership to enable the financial restructuring. It filed for court protection in the southern city of Lyon in July, but the running of the business has not been impacted as it holds discussions with potential partners.

Martin Mabille, chairman and chief executive officer of Alexis Mabille, said the label designed by his brother was heavily impacted by the coronavirus pandemic. With its principal shareholders deadlocked over key strategy decisions, it has not been able to raise additional capital since 2015.

“Today, we need funds to finance our strategy and our projects,” Mabille told WWD in an exclusive interview. “It’s a technical procedure which aims to give us the means and the legal framework to restructure our capital and restructure the debts that were contracted during COVID-19.”

“It’s business as usual, with the expectation of being able to enjoy much greater freedom in 2025, once the fundraising has been completed and the restructuring has been finalized, since this time we will be able truly to move forward with a new pool of shareholders who support the brand,” he added.

“The company is recruiting. We’re working with our clients and our partners, we’re developing new projects,” Mabille added.

His family currently holds a third of shares. He declined to name the other shareholders, but explained that a third was owned by a French private equity fund that was formerly financed by the country’s ISF wealth tax, which was scrapped in 2018. The remaining third is held by a large Chinese rtw group and a family office in Singapore.

Alexis Mabille announced in 2015 it had signed a partnership with Chinese fast-fashion retailer Peacebird to establish a network of stores in Greater China. Under the terms of the deal, Ningbo Peacebird Fashion Co. Ltd. acquired a minority stake in the Paris-based brand for an undisclosed sum.

In recent years, the Chinese shareholder was not aligned on strategy, even as the French fund saw its source of capital dry up, Mabille reported.

“The governance of the company is virtually blocked,” he said. “The objective is to completely renew the nonfamily shareholding.”

The brand’s immediate priority is to invest in customer relationship management by infusing fresh funds into its couture salon above its store in the historic Galerie Vivienne in Paris, and bolstering its digital interactions with clients; padding out its atelier, and recruiting additional customer relations associates.

In 2018, Alexis Mabille repositioned its main ready-to-wear collection to focus on the sophisticated tuxedos and glamorous evening gowns that have won the label fans including Alexandra Daddario, Lady Gaga and Dita Von Teese. Since 2020, it has designed exclusive lines for a reduced number of key retail partners such as Harrods in London.

“I think we did the right thing since 2018 in focusing on haute couture to continue to develop the brand so that, in two or three years’ time, we can relaunch a luxury ready-to-wear and accessories collection,” Mabille said.

Couture orders are back to pre-pandemic levels and the company returned to profitability in 2023, after seeing revenues plummet by 75 percent in 2020 and 2021 amid a dearth of major social events, he said.

The brand, which employs around 20 permanent staff and has not implemented any layoffs, hopes to announce the arrival of new shareholders early next year.

“We are looking at all interested parties. The solutions include support from international groups who are active in the luxury space, or family offices that are entrepreneurs with an appetite for luxury and high-end craftsmanship,” he said.

“They understand that it’s a very good time to invest in a brand that has a beautiful history, that is coming out of a difficult period not entirely unscathed and needs to restructure financially, but whose underlying business is good,” he added.

Mabille is not the only couture brand affected by the pandemic. Earlier this year, Los Angeles-based e-commerce player Revolve Group said it had bought a majority stake in Alexandre Vauthier after the company entered receivership in February.

TechCrunch : Elon Musk files for injunction to halt OpenAI’s transition to a for

Elon Musk files for injunction to halt OpenAI’s transition to a for-profit

Attorneys for tech billionaire Elon Musk have filed for a preliminary injunction against OpenAI, several of its co-founders, and its investor and close collaborator, Microsoft, to prevent OpenAI and other named defendants from engaging in what Musk’s counsel claims is anticompetitive behavior.

The motion for an injunction, which was filed late on Friday in the U.S. District Court for the Northern District of California, accuses OpenAI, its CEO Sam Altman, President Greg Brockman, Microsoft, LinkedIn co-founder and former OpenAI board member Reid Hoffman, and former OpenAI board member and Microsoft VP Dee Templeton of various illicit activities — and seeks to halt them. The allegations include:

  1. Discouraging investors from backing OpenAI rivals like Musk’s own AI company, xAI.
  2. Benefitting from “wrongfully obtained competitively sensitive information” through OpenAI’s connections with Microsoft.
  3. Converting OpenAI’s governance structure to a for-profit and “transferring any material assets, including intellectual property owned, held, or controlled by OpenAI, Inc., its subsidiaries, or affiliates.”
  4. Causing OpenAI to do business with organizations in which any defendant has a “material financial interest.”

Attorneys for Musk assert that “irreparable harm” will ensue if the injunction isn’t granted.

“Plaintiffs and the public need a pause,” they wrote in the filing. “An injunction to preserve what is left of OpenAI’s nonprofit character, free from self-dealing, is the only appropriate remedy. If not, the OpenAI promised to Musk and the public will be long gone by the time the court reaches the merits.”

The motion is the latest salvo in Musk’s legal battle with OpenAI, which at its core accuses the company of abandoning its original nonprofit mission to make the fruits of its AI research available to all. Musk withdrew the suit in July, only to revive it late this summer. An amended complaint earlier this month named new defendants including Microsoft, Hoffman, and Templeton, and two new plaintiffs: Shivon Zilis, a Neuralink exec and ex-OpenAI board member, and xAI.

Musk has argued in previous complaints that he’s been defrauded out of more than $44 million he says he donated to OpenAI by preying on his “well-known concerns about the existential harms” of AI. Musk, one of OpenAI’s co-founders, left the company in 2018 over disagreements about its direction.

OpenAI launched in 2015 as a nonprofit, and in 2019, converted into a “capped-profit” in which the nonprofit was made the governing entity for a for-profit subsidiary. The company is in the process of converting into a fully for-profit corporation that would reportedly allow OpenAI to retain its nonprofit status as a separate entity.

Musk formed his answer to OpenAI, xAI, last year. Soon after, the company released Grok, an AI model that now powers a number of features on Musk’s social network, X (formerly known as Twitter). xAI also offers an API that allows customers to build Grok into third-party apps, platforms, and services.

In the motion for an injunction, Musk’s attorneys allege OpenAI is depriving xAI of capital by extracting promises from investors not to fund it and the competition. In October, the Financial Times reported that OpenAI demanded investors in its latest funding round abstain from also funding any of OpenAI’s rivals, including xAI.

“Musk has verified that at least one major investor in OpenAI’s October funding round has subsequently declined to invest in xAI,” counsel for Musk wrote.

Of course, xAI has had no trouble raising money lately. Reportedly, the startup closed a $5 billion round this month with participation from prominent investors including Andreessen Horowitz and Fidelity. With around $11 billion in the bank, xAI is one of the best-funded AI companies in the world.

Musk’s motion for an injunction also alleges that Microsoft and OpenAI continue to illegally share proprietary information and resources, and that several of the defendants, including Altman, are engaging in self-dealing that harms marketplace competition. For example, the filing notes, OpenAI selected Stripe, a payment platform in which Altman has “material financial interests,” as OpenAI’s payment processor. (Altman is said to have made billions from his Stripe holdings.)

Microsoft, which first backed OpenAI in early 2019, has ramped up the partnership over the last several years, investing a total of ~$13 billion in exchange for what’s effectively a 49% stake in the company’s earnings. Microsoft has also allowed OpenAI to make extensive use of its cloud hardware resources, enabling the startup to train, fine-tune, and run AI models like those that power ChatGPT.

Hoffman’s position on the boards of both Microsoft and OpenAI while also a partner at investment firm Greylock gave Hoffman a privileged view into the companies’ dealings, Musk’s attorneys argue. (Hoffman stepped down from OpenAI’s board in 2023.) As for Templeton, whom Microsoft briefly appointed as a nonvoting board observer at OpenAI, Musk’s counsel argues that she was in a position to facilitate agreements between Microsoft and OpenAI that would violate antitrust rules.

“Maintaining OpenAI’s charitable status pending final resolution and halting further self-dealing transactions by Altman protect both the organization’s founding mission and the public interest in proper administration of charities,” Musk’s attorneys said in the filing.

Counsel for Musk wrote that if an injunction isn’t granted, OpenAI might “lack sufficient funds” to pay damages were the court to eventually rule in Musk’s favor. (OpenAI is reportedly spending more than $5 billion and isn’t close to breaking even.) Moreover, they say, were a judge to disallow OpenAI’s nonprofit transition, it’d be “virtually impossible” to “unwind” the company’s transactions without “widespread investor loss” should OpenAI continue to accept new investments.

OpenAI is under pressure to complete the transition quickly. According to Bloomberg, investors in its latest funding round will be able to claw back their cash if OpenAI doesn’t convert to a for-profit within two years.

“No objective observer can look at OpenAI today and say it bears any resemblance whatsoever to what it promised to be,” attorneys for Musk wrote. “Plaintiffs respectfully request that the court maintain the status quo and pause defendants’ worsening behavior until final disposition.”

In an emailed statement, an OpenAI spokesperson said, “Elon’s fourth attempt, which again recycles the same baseless complaints, continues to be utterly without merit.” The company had previously sought to dismiss Musk’s suit, calling it “blusterous” and baseless.

FT : Trump threatens Brics nations with 100% tariffs if they undermine dollar

Trump threatens Brics nations with 100% tariffs if they undermine dollar
Warning against pushing alternatives to reserve currency is latest trade threat from incoming president

US president-elect Donald Trump on Saturday threatened tariffs of 100 per cent against the so-called Brics countries unless their governments agree not to create a new currency as an alternative to the US dollar.

“The idea that the Brics Countries are trying to move away from the Dollar while we stand by and watch is OVER,” Trump wrote in a post to his Truth Social platform on Saturday afternoon. 

The group is made up primarily of Brazil, Russia, India, China and South Africa, but has recently expanded to include Iran, Saudi Arabia, United Arab Emirates, Argentina, Egypt and Ethiopia. 

Although the US dollar is the most-used currency in global business and trade, Brics nations such as Russia and China have called for the bloc to challenge the dollar’s status as the world’s reserve currency. A proposal for a Brics currency was introduced at last year’s summit in South Africa. 

“We require a commitment from these Countries that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy,” Trump wrote on Saturday.

In October, Russian president Vladimir Putin accused western powers of “weaponising” the dollar, arguing at a Brics summit in Kazan that sanctions against Russia since its invasion of Ukraine “undermine the trust in this currency and diminish its powers”.

The threats of steep tariffs against US imports from the countries follow similar threats made to Mexico, Canada and China earlier this week as Trump signals that he intends to use punitive measures to force US trading partners to comply with his demands.

Trump said he would impose tariffs of 25 per cent on all imports from Canada and Mexico, and an extra 10 per cent on Chinese goods, accusing the countries of permitting illegal migration and drug trafficking.

Those threats raised the possibility of countermeasures from Mexico and prompted a hurried visit to Trump’s Mar-a-Lago residence by Canadian prime minister Justin Trudeau on Friday evening.

Trump won a convincing electoral victory earlier this month after campaigning on a pledge to issue sweeping tariffs on foreign goods imported to the US, including an extra 60 per cent on Chinese goods.

FT : World’s largest caterer Compass chases further deals in Europe

World’s largest caterer Compass chases further deals in Europe
Group has recently spent $1.7bn on M&A in the region with return to office mandates boosting revenues

Compass is on the hunt for more deals in Europe, after the world’s largest caterer spent a total of $1.7bn on a series of acquisitions in the region over the past year in a bid to tap strong outsourcing demand.

The FTSE 100 group, which provides food for work and school canteens in about 30 countries, announced this week that it agreed to acquire 4Service, a catering and facility management services business in Norway, for $500mn. This followed an announcement in November that it has completed the acquisition of Dupont Restauration, a food services business in France, for roughly $300mn.

The company had already spent $900mn on acquiring Germany’s pre-prepared frozen meals producer Hofmanns and the UK’s CH&CO, the hospitality provider for Kew Gardens and the Royal Ballet and Opera, in the year ended September.

“There will still be one or two [deals] over time,” chief executive Dominic Blakemore told the Financial Times, adding that he was keen to explore deals related to food purchasing to build more “open cafés” — unstaffed stores set up in offices to sell chilled food and coffee.

He added that on top of booming food service demand for concerts, festivals and sporting events, catered events for companies were also increasing. “We see clients really using food to power socialisation, to bring people . . . and get them reconnected on particular topic areas,” he said.

Compass’s interest in further M&A comes as it reported a 16.4 per cent rise in its underlying operating profit to $3bn for the year ended September 30, with revenue up 10.6 per cent to hit $42.2bn.

The group was boosted by more workers returning to offices, many of them seeking cheaper alternatives to high street lunches, and was expecting to deliver “high single-digit profit growth” for the current fiscal year.

Compass also disclosed it is pulling out from four markets, including Chile and Mexico, in addition to five markets including China and Brazil announced in May, to allocate more funds for takeovers and investments in Europe.

Blakemore said that the takeover of CH&CO gave Compass a strong footprint in the creative arts and media industries, while that of Dupont opened up the business in the north of France where Compass had not been present.

Acquiring Hofmanns would allow Compass to use its frozen technology to be able to serve prepared meals to small companies without kitchen facilities, he added.

Blakemore said he was keen to replicate in Europe the model Compass built in North America “where we bought the best operator in each of the sectors or regional markets”.

Its business in North America now accounts for about 70 per cent of the group’s revenues after the company bought 18 companies in the region between 1994 and 2017, including tech sector-focused food service operator Bon Appetit and Morrison Management Specialists which specialises in care homes and hospitals.

FT : Carlyle-backed life sciences investor launches $1.5bn clinical trials fund

Carlyle-backed life sciences investor launches $1.5bn clinical trials fund
Abingworth wants to pursue royalty-based partnerships with major pharma groups

Carlyle-backed investor Abingworth is tapping investors for a fund worth up to $1.5bn to bankroll clinical trials, as it pioneers partnerships with big pharmaceutical companies for a share of royalties from new drugs.

The UK-based life sciences investor is planning to finance as many as eight late-stage trials with the new fund, according to people familiar with the fundraising. Carlyle, the private equity group which bought Abingworth in 2022, will also invest in the fund as a limited partner, the people said. 

The fundraising effort comes after Abingworth signed two royalty deals with large pharmaceutical and biotech companies earlier this year, and as the fund plans to return around $500mn to investors in a year in which the biotech venture capital sector has struggled.

In February, it announced a collaboration with California’s Gilead Sciences to develop the cancer drug Trodelvy in a deal worth up to $210mn. Trodelvy is already approved to treat some cancers including breast cancer, and Abingworth is now helping to fund trials to see if it can tackle lung cancer. 

In April, Abingworth agreed to fund clinical research for an asthma inhaler with Israeli drugmaker Teva in a deal worth up to $150mn. 

The latest fund is likely to close by the first half of next year, the people said.

Founded in 1973, Abingworth previously focused on venture capital investments in early stage biotech companies.

It hopes the new fund will attract larger pharmaceutical companies that want to reduce their capital expenditure, while still pursuing a larger portfolio of potential drugs for “more shots on goal”, an industry term for maximising the chances of getting a successful drug.

Pharma groups are eager to refill their drug pipelines as many blockbuster medicines will go off patent in the coming years. While smaller biotechs have previously done deals with specialist royalty companies to secure financing for expensive trials, it is unusual for larger drugmakers to take this approach. 

Last year, Abingworth raised a $356mn fund to invest in trials alongside companies, which it said at the time was “significantly oversubscribed”, exceeding its target of $300mn.

Abingworth has told potential investors in the fund that it has historically had a higher-than-average success rate in spotting the right medicines and developing them in phase-three trials, with about 80 per cent of experimental medicines that it had helped finance receiving approvals. This compares to an industry average of about 55-60 per cent, the people said.  

Abingworth previously invested in so-called “co-development deals” through portfolio company SFJ Pharmaceuticals. But in August, it hired SFJ Pharmaceuticals’ chief executive Robert deBenedetto to work with pharma companies and larger biotech companies. 

The majority of these deals will now be done in-house or with Abingworth’s wholly owned platform Launch Therapeutics.

Abingworth and Carlyle declined to comment.

FT : Pharma deals fall to lowest level in almost a decade

Pharma deals fall to lowest level in almost a decade
Experts forecast Trump administration could usher in new era of mergers and acquisitions among drugmakers

Deals in the pharmaceutical industry have sunk to their lowest level in almost a decade, as the world’s biggest drugmakers shy away from big bets on commercially ready medicines in favour of earlier-stage drug developers.

By late November, pharma groups such as Eli Lilly, Novartis and Vertex Pharmaceuticals had completed a total of 558 deals globally, worth a combined value of $67.2bn, the lowest level for that stage of the year since 2016, according to London Stock Exchange data.

The biggest biotech deal of the year — Vertex’s $4.9bn buyout of autoimmune disease biotech Alpine Immune Sciences — pales in comparison to last year’s biggest acquisition: Pfizer’s $43bn takeover of cancer drug developer Seagen. The dollar value of deals by late November stood at half that of last year, according to LSEG data.

The dearth of blockbuster deals this year — driven by pharma groups concentrating on digesting larger deals from last year as well as the frothy valuations of the larger listed biotechs turning off potential acquirers — is the main factor behind the slow mergers and acquisitions activity this year, advisers told the Financial Times.

This is despite an expected $59bn loss in sales across the major pharma groups when 190 drugs lose exclusivity by the end of the decade, according to KPMG.

Andrew Weisenfeld, an investment banker at MTS Health Partners, which advised Seagen, said: “To some degree, [pharma groups] addressed their loss of patent life on existing drugs so they got pickier — and a lot of bigger companies got really expensive, and people just aren’t paying those prices.”

“Big pharma ate through a lot of the available targets in 2023,” said Jamie Leigh, co-chair of Cooley’s mergers and acquisitions group. “[Companies were] more judicious about the remaining pool in 2024.”

Some bigger deals have been completed this year but none were instances in which a pharma group was buying a biotech to get hold of promising drugs. Novo Nordisk this year agreed to pay $11bn to acquire three manufacturing sites from Catalent in a three-way deal involving its parent company, while Sanofi handed control of its consumer drug division to private equity group Clayton Dubilier & Rice in a €16bn deal.

A tough antitrust environment under Lina Khan’s Federal Trade Commission as well as the political uncertainty of an election year has also slowed deal activity. But the election of Donald Trump could usher in the return of bigger healthcare tie-ups.

“Trump coming to power is generating cautious optimism for increased deal flow and investments in the biopharma sector” said Zahid Moneer, a senior managing director of healthcare at BNP Paribas. ‘There’s a cautious buzz around that in January you will see a significant rebound in activity.”

For the time being, pharma companies have prioritised bolt-on deals of below $5bn, favouring private companies over listed groups. Danish pharma group Lundbeck bought neuroscience start-up Longboard for up to $2.6bn in October, while Merck bought privately owned ophthalmology biotech EyeBio for up to $3bn.

Siddhart Nahata, global head of healthcare investment banking at Morgan Stanley, said: “Bolt-ons are business as usual — large-cap [pharma groups] have had to keep doing bolt-ons to supplement their internal R&D efforts. There’s no way around that.”

Despite some of the uncertainty still affecting the biotech sector, in particular what Trump’s pick for health and human services secretary Robert F Kennedy Jr might mean for drugmakers and vaccine makers, most dealmakers expect a more positive outlook next year.

“Healthcare has had a lot of dramatic headline news in the past 10 days,” Nahata said. “We need to digest what that actually means in terms of policy, and that will have implication in terms of what people pursue in terms of M&A . . . but I do certainly expect 2025 to be a more active year.”