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Bernard Arnault partners with Red Bull to buy Paris FC in latest move into sport

Alliance with soft-drink maker comes a week after LVMH clinched a 10-year deal with Formula One

The family of LVMH’s Bernard Arnault has teamed up with Red Bull to take over Paris FC in the second tier of French football as the luxury billionaire expands his involvement in sport.

Arnault and his five adult children, who all have operational roles within the luxury group, will become majority shareholders through one of their holding companies alongside sport drink maker Red Bull, according to two people with direct knowledge of the arrangement.

Under the terms of the deal — which could still shift, the people said — Paris FC president and majority shareholder Pierre Ferracci will retain a 30 per cent shareholding until 2027, after which he plans to exit. The Arnault family will take a 55 per cent stake in the club until they can buy the rest of Ferraci’s share in a few years, while Red Bull will take 15 per cent.

The deal was first reported by sports news outlet L’Équipe. The Arnault family and LVMH declined to comment. Ferracci and Red Bull did not immediately respond to requests for comment.

The negotiations on the Arnault’s side were led by Antoine, Arnault’s eldest son, and Frédéric, the second youngest.

Antoine leads communications at the luxury group and is chief executive of holding company Christian Dior SE. Frédéric heads up LVMH’s watchmaking division and is deputy managing director at Financière Agache, another family holding.

LVMH last week announced a 10-year deal with car racing franchise Formula One, and was a high profile sponsor of this summer’s Paris Olympics. The initiatives are part of a wider push by luxury groups to link themselves to sports teams, franchises and stars as they seek to connect with an ever wider audience.

Red Bull, which markets its fizzy energy drinks through sport, owns two F1 racing teams and several football clubs. The Austrian-based company on Wednesday hired former Liverpool manager Jürgen Klopp to head its network of football clubs, his first job since leaving the English club in the summer.

Red Bull took a minority stake in English second-tier football club Leeds United in May, adding to a portfolio of teams in the US, Brazil, Austria and Germany.

Arnault, 75, whose family owns 48 per cent of LVMH, has an estimated personal worth of $191bn, according to Bloomberg. Red Bull’s revenues totalled more than €10.5bn in 2023, a 9 per cent increase from the prior year.

A takeover would also be welcome news for French football after the collapse in the value of its media rights.

Unlike London, Paris is dominated by one club. Owned by state-backed Qatar Sports Investments, Paris Saint-Germain has won the top French league six times in the past seven seasons.

In contrast, Arsenal, Chelsea and Tottenham Hotspur are among the London-based football clubs that do battle in the English Premier League. Milan boasts AC Milan and Internazionale, while Manchester has Manchester City and Manchester United.

Bahrain took a 20 per cent stake in Paris FC in 2020 but the club has remained in Ligue 2. It is top of the division after eight matches played so far this season, raising hopes of promotion to the top flight.

Centre-right government bets on 10 years of tax breaks to stop brain drain

Portugal is planning to turn itself into a low-tax haven for young people by offering a decade of tax breaks to people starting their careers in an effort to halt a growing brain drain.

The country’s centre-right government wants to reduce the income tax burden on young people for 10 years — including a first year in which no tax is due — under a plan that has few precedents in fiscal policy elsewhere.

The initiative underlines the urgency of reversing a debilitating outflow of young people, who are leaving one of the poorest economies in western Europe in search of better paid jobs abroad.

Portuguese Prime Minister Luís Montenegro, who leads a fragile minority government, will present the tax plan as part of a 2025 budget on Thursday, but it is not certain he has enough votes to get it approved by parliament. If he fails, his government’s survival will be in doubt.

The government in Lisbon is seeking to tackle a combination of high taxes, low wages and high housing costs that are driving many highly educated young people out of the country.

“Our goal is truly to increase our ability to retain talent, to keep our young people in Portugal, ensuring that fewer of them leave, and that those who do can return,” Montenegro said this summer. “We want a tax system that is more youth friendly.”

Under the proposal, young people would pay no income tax in their first year of work. They would be exempted from 75 per cent of tax due in years two to four, exempted from 50 per cent of tax due in years five to seven, and exempted from 25 per cent in years eight to 10.

But the IMF has raised doubts over the fiscal incentives for young people, warning that the impact of age-based preferential tax rates on emigration is “uncertain”.

Gonçalo Matias, chair of the Francisco Manuel dos Santos foundation, said it was “absolutely critical” to stem the emigration of graduates from Portuguese universities that had received a surge of public investment.

“Portugal has been investing in education, but that investment is benefiting countries like France and Germany,” which receive Portuguese immigrants, he said. “It doesn’t make sense for a poor country like Portugal that actually benefited a lot from European funds and European solidarity to then lose that investment to the richer countries.”

Matias described the proposed tax breaks as “sensible and balanced”, but said that to change the tide, the government would also need to do more to make housing affordable, help young people find employers, and cut red tape.

The previous Socialist government, which lost an election this year, also introduced tax breaks for young people, but they were only available to university graduates. The current proposal would apply to everyone under 35.

Montenegro said in a television interview on Tuesday that his government’s proposal was “a more balanced solution . . . than the one we had initially”, a reference to the outcome of talks with the Socialist opposition that led him to cut the scheme’s length to 10 years from 13.

But the Socialist party’s support for the budget is not guaranteed because it is opposed to cutting the corporate tax rate, which is also part of the government’s plans.

Marina Costa Lobo, director of Lisbon’s Institute of Social Sciences, said Montenegro had appeared “very moderate and also quite pragmatic” in the haggling over youth income tax. “If the Socialists refuse to support this budget, they will look irresponsible. They will look like they are rejecting stability in favour of resisting giving any kind of support to this government.”

The prime minister could also reach a majority with the support of the hard-right Chega party, Portugal’s third-biggest political force.

Its leader André Ventura has spoken approvingly about the youth tax cuts, but he also presents himself as Montenegro’s chief opponent and lambasts dealmaking between the Democratic Alliance (AD) and the Socialists.

Portugal has long been a country of emigrants. The number of people who were born there but live overseas is equal to about one quarter of Portugal’s resident population of 10.6mn, the highest rate in the EU, according to the Emigration Observatory.

But in recent years the departure of talented young people has come to be seen as an economic handicap.

Between 2008 and 2023, 361,000 people aged between 15 and 35 left the country, accounting for two-thirds of all emigrants during that period, according to the national statistics institute.

Despite the outflow, Portugal’s population has continued to grow in part because it has attracted migrants from other countries with a golden visa programme and tax incentives for well-off expats, both of which are being phased out. The new youth tax breaks will, however, be available to non-Portuguese citizens who move to the country.

The government estimates that the youth tax breaks will cost the state about €650mn a year.

The IMF warned that such reductions in tax revenue ran counter to Portugal’s needs to pay off government debt while funding more public investment.

A worker in Portugal earning the average annual wage of about €20,000 currently pays a top income tax rate of 26 per cent. Anyone earning between roughly €21,000 and €27,000 pays a top rate of 32.75 per cent.

CSI 300 rises almost 3% as central bank launches lending facility to stabilise market

Chinese stocks rose on Thursday in volatile trading ahead of a weekend press briefing from the country’s finance minister, as the central bank launched a facility to make it easier to buy stocks.

The benchmark CSI 300 index rose almost 3 per cent on Thursday after closing down 7 per cent on Wednesday in its first loss in 11 consecutive sessions. Hong Kong’s Hang Seng index was up 4.2 per cent after posting its worst daily loss since 2008 on Tuesday and falling further on Wednesday.

The CSI 300 has surged by more than 30 per cent since late September after the Chinese government unveiled a stimulus package to revive economic confidence. The rally started to fade this week as investors began to question the government’s plan to boost the economy and its capital markets.

“Buy everything China-related was what we observed over the past two weeks,” said Richard Tang, China strategist and head of research Hong Kong at Julius Baer. “But after a few days of heavy profit-taking, the offshore market is to move on to the second phase of the rally, which features slower gains, higher volatility but with the basics — earnings and valuations — back in focus.”

Chinese equities rebounded on Thursday after Beijing announced a Saturday press briefing with finance minister Lan Fo’an, fuelling expectations that the government would announce more stimulus measures.

“The market is certainly looking for hints of more policy support coming”, said Jason Lui, head of Asia-Pacific equities and derivatives strategy at BNP Paribas.

China’s central bank on Thursday moved forward with a scheme to enable domestic financial companies to buy more stocks, a tool designed to stabilise the market and shore up liquidity.

The facility allows non-bank financial companies to borrow from the People’s Bank of China to buy equities, with bonds, stocks or exchange traded funds serving as collateral.

The bank said it was accepting applications from eligible securities groups, funds and insurance companies to pledge ETFs, bonds or constituent shares of the CSI 300 index for more liquid assets such as sovereign bonds and central bank notes.

The funds can only be invested into stock market, the PBoC has said.

The size of the Rmb500bn ($70bn) tool “can by expanded depending on market conditions”, said the bank. The mechanism is designed to “enhance the inherent stability” and “promote healthy development” of the capital markets, it said.

Experts said the tool was similar to the US Federal Reserve’s Term Securities Lending Facility, which allowed dealers to borrow liquid assets such as Treasuries for financing by pledging illiquid collateral such as corporate bonds.

It was created during the 2008 financial crisis and revived in 2020 during the pandemic.

The idea is the latest from the GOP nominee that goes beyond extending the 2017 tax law

WASHINGTON—Republican presidential nominee Donald Trump said he supports lowering taxes on U.S. citizens who live abroad, marking a new attempt by the former president to win support from an often-overlooked group of voters.

The U.S. has an unusual system for taxing its citizens on their total income regardless of where they earned it and where they live, making America alone among major countries with such a rule. Other countries use systems that base taxation on where people live. The U.S. policy dates back to the 1860s and the income tax created to finance the Civil War.

Essentially, an American living in Paris would have tax obligations to both France and the U.S., though the U.S. tax code already contains features meant to mitigate double taxation. A French citizen residing in New York typically wouldn’t owe France any taxes on U.S. income.

“I support ending the double taxation of overseas Americans,” Trump said in a statement to The Wall Street Journal.

Like his prior campaign ideas to eliminate taxes on tips, Social Security benefits and overtime pay, Trump’s latest tax-policy promise goes beyond extension of his expiring 2017 tax cuts and the ideas he pushed during his first term as president, and it is aimed at a targeted demographic.

A narrow policy shift could eliminate a frustrating and unique burden for Americans abroad, especially those with higher incomes and investments who owe U.S. taxes on their worldwide income on top of taxes they pay where they live. That can be particularly annoying for so-called accidental Americans, who have citizenship because they were born in the U.S. but have few ties to the country.

A more expansive revision of the tax code could open opportunities for wealthy Americans to move overseas, retain their citizenship and escape some U.S. taxes.

What Trump means by double taxation remains uncertain, and campaign officials offered no additional details about exactly what policy change he would try to push through Congress.

Solomon Yue, the chief executive of Republicans Overseas, an advocacy group, is part of a decadelong push to ease U.S. tax burdens on Americans abroad. Yue said he was inspired by Trump’s earlier tax proposals aimed at other constituencies and realized he might have a chance to get his issue added to that list.

Yue, a longtime Republican National Committee official, said he urged Trump campaign aides to get the subject in front of the former president and to keep any position simple rather than getting into a detailed explanation of citizenship-based taxation versus residence-based taxation. That effort helped lead to Trump’s new support for the issue, according to Yue.

“America first also means Americans first, regardless of where they are residing,” Yue said, praising Trump’s support for cutting taxes for Americans who live abroad. “It’s a giant first step,” Yue added.

Roughly 4.4 million U.S. citizens lived abroad in 2022, according to the most recent statistics available from the Federal Voting Assistance Program, which helps people get information on how to cast ballots. Some 2.8 million of those were 18 years or older and eligible to vote in their former states, according to the group.

The Trump campaign is hoping the proposal will appeal to many of those voters, particularly those who live in Israel, according to a person familiar with the matter.

“Fellow Americans living abroad, your vote is more important than ever,” Trump said in the statement.

Polls show a neck-and-neck race between Trump and Vice President Kamala Harris, who has been offering her own financial incentives, including Medicare coverage of long-term home care and tax credits for new parents and first-time home buyers. Harris hasn’t announced a proposal to change taxes for Americans abroad.

There are some limits on the U.S. tax on Americans abroad. They don’t have to pay American taxes on their first $126,500 in earned income, and there are some exclusions for housing costs.

They can also get tax credits for some payments to foreign governments, so they are only paying the U.S. when U.S. taxes are higher than their local taxes. But higher earners and people with investment or retirement income sometimes have to pay the U.S. on top of their foreign taxes.

Often, the compliance costs for filing tax returns can far exceed the actual taxes that Americans owe, said Marylouise Serrato, executive director of American Citizens Abroad, a nonpartisan group that has been advocating for a move toward residence-based taxation.

“It makes it very difficult and complex to file, and it also limits the ability of a lot of Americans to invest and live when they’re overseas,” she said.

But not everyone agrees that Americans overseas carry an undue tax burden or that the U.S. rules are an overreach.

“They are voluntarily retaining this connection to the United States,” said Michael Kirsch, a Notre Dame law professor who has written on citizenship-based taxation. “If we were to move to a residence-based taxation system, then I think we have to think long and hard about what the consequences would be for social cohesion and what our country would look like.”

For now, the only sure way out of the U.S. tax net is to renounce citizenship. For some millionaires and others, that comes with an exit tax.

Advocates for Americans abroad have been working for years on ideas to shift the U.S. from citizenship-based taxation to residence-based taxation. One option would tax Americans abroad the same way that the U.S. taxes nonresident foreigners.

They pay taxes on certain U.S.-sourced income and dividends, but don’t face full, worldwide U.S. taxation on all their income. American Citizens Abroad has estimated that transition taxes and fees could make such a plan revenue-neutral, basically by lowering taxes on current Americans abroad and imposing one-time taxes on citizens who move away.

The challenge, Kirsch said, would be trying to prevent wealthy Americans with significant assets from establishing residences in low-tax countries.

“I’ve got to assume that a lot of people would be on the move,” he said of a pure residence-based system. For example, take Monaco, where there is no personal income tax. “For the amounts involved, I’ve never been to Monaco, but I’ve heard it’s a nice place,” he said.

Yue said that once the idea got to Congress, there would be a need for guardrails to prevent abuse. There could be limits for residents of very-low-tax countries. The definitions of what it means to be a resident for tax purposes and what counts as U.S. income would be extraordinarily important.

Palantir now owns 8.7% of struggling electric vehicle startup Faraday Future, according to a new filing with the U.S. Securities and Exchange Commission.

The data-mining company was granted more than 800,000 shares in the EV startup on October 2 “as payment for certain outstanding receivables” — the equivalent of roughly $2.4 million judging by Faraday Future’s stock price on that day. Palantir doesn’t explicitly say what receivables were outstanding. But the companies quietly entered a settlement earlier this year after the EV startup stopped paying the data company for services it agreed to buy all the way back in 2021.

Palantir revealed the transaction in what’s known as a 13-G filing, meaning it intends to treat the stake passively, so it’s not likely that Palantir will try to hold sway over what little business Faraday Future has these days. The EV company has only delivered around a dozen cars and is constantly in need of new funding.

Instead, Palantir’s stake is a sort of peculiar outcome of the last few years, where so many EV startups rapidly went boom and then bust.

Faraday Future was one of many EV startups that hopped on the special purpose acquisition company (SPAC) craze happening at the time. It was rewarded for following the crowd: The startup raised $1 billion when it merged with a SPAC and became a public company.

Palantir played a small part in that process, throwing $25 million into the Private Investment in Public Equity (PIPE) portion of the merger, where the company going public sells shares to outside companies looking to join the ride. In exchange, Faraday Future signed a commercial contract with Palantir to use the data-mining company’s services. (Palantir did a number of these kinds of transactions — investing in SPAC mergers and simultaneously signing commercial contracts — at the time.) Palantir ultimately sold those shares.

Faraday Future said in 2021 that its partnership with Palantir would help the EV startup “develop disruptive products and services.” But the partnership broke down. Palantir sent Faraday Future a letter in April 2023 alleging the EV startup had breached the agreement, according to SEC filings. The data-mining company claimed it was owed $12.3 million. In July 2023, Palantir filed a demand for arbitration claiming the “amount in controversy” was actually $41.5 million.

hed a settlement in March 2024. Faraday was supposed to pay $5 million, but $4.8 million of that was still outstanding in August, when the companies amended the settlement. Faraday Future then pledged to pay Palantir $2.4 million worth of company stock in August and again in October.

Faraday Future made that first payment in stock before it performed a 1-for-40 reverse stock split on August 16, meaning Palantir initially didn’t own all that much of the startup. But the second payment came after the split, giving it far more shares and, therefore, a nearly 9% ownership stake.

Neither company immediately responded to a request for comment.