TheChek News Flow

Summary

• Israel's air-launched ballistic missiles used against heavily defended Iranian targets
• Air-launched ballistic missiles fast, accurate, complicate defences
• US, most other major powers do not use the weapons

The Israel Defense Forces said its Oct. 26 raid knocked out Iranian missile factories and air defences in three waves of strikes.

Researchers said that based on satellite imagery, targets included buildings once used in Iran's nuclear programme.

Tehran defends such targets with "a huge variety" of anti-aircraft systems, said Justin Bronk, an airpower and technology expert at London's Royal United Services Institute.

Cruise missiles are easier targets for dense, integrated air defences than ballistic missiles are. But ballistic missiles are often fired from known launch points, and most cannot change course in flight.

Experts say high-speed, highly accurate air-launched ballistic missiles such as the Israel Aerospace Industries Rampage get around problems facing ground-based ballistic missiles and air-launched cruise missiles - weapons that use small wings to fly great distances and maintain altitude.

"The main advantage of an ALBM over an ALCM is speed to penetrate defences," said Jeffrey Lewis, director of the East Asia Nonproliferation Program at the James Martin Centre for Nonproliferation Studies at the Middlebury Institute of International Studies in California. "The downside - accuracy - looks to have been largely solved."

Ground-launched ballistic missiles - which Iran used to attack Israel twice this year, and which both Ukraine and Russia have used since Russia's invasion in 2022 - are common in the arsenals of many countries. So, too, are cruise missiles.

Because ALBMs are carried by aircraft, their launch points are flexible, helping strike planners.

"The advantage is that being air-launched, they can come from any direction, complicating the task of defending against them," said Uzi Rubin, a senior researcher at the Jerusalem Institute for Strategy and Security, one of the architects of Israel's missile defences.

The weapons are not invulnerable to air defences. In Ukraine, Lockheed Martin (LMT.N), opens new tab Patriot PAC-3 missiles have repeatedly intercepted Russia's Khinzhals.

The limited-edition collection blends Mikimoto’s pearls with Chrome Hearts’ rebellious spirit.

Mikimoto and Chrome Hearts are joining forces to bring together their distinct design aesthetics for a limited-edition jewelry collection highlighting pearls.

The Japanese fine jewelry brand and the Los Angeles-based luxury label are partnering on a collection launching Friday that leverages Mikimoto’s pearls and merges them with Chrome Hearts’ rebellious aesthetic.

According to the two brands, the collaboration has been many years in the works as they spent years understanding each other’s design processes.

“By combining Mikimoto’s legacy of excellence in pearl cultivation with Chrome Hearts’ innovative design approach, we’ve created pieces that are truly unique in the luxury jewelry landscape,” said Yasuhiko Hashimoto, chief executive officer of Mikimoto. “Every pearl is meticulously selected for its purity and perfection, while Chrome Hearts infuses a rebellious spirit into each design. Together, these elements culminate in jewelry that is as bold as it is timeless, honoring both the traditions of pearl craftsmanship and the cutting-edge sensibilities of modern luxury.”

The collection includes 11 pieces — such as a safety pin brooch, a charm bracelet, drop earrings, stud earrings and a pendant necklace — that are designed with Mikimoto’s Akoya and White South Sea pearls and Chrome Hearts’ 18-karat gold and diamonds.

There are also four exclusive handmade diamond and pearl necklaces. Only two units of each style will be produced.

“My family and I have been forever collectors of Mikimoto and always admired them for their very specific aesthetic and thoughtful approach,” said Jesse Jo Stark, daughter of Chrome Hearts’ founder Richard Stark, the brand’s owner and designer. “In terms of my inspiration for this collaboration, I was very much thinking of my mother and father and wanted to represent both feminine and masculine.”

The Mikimoto Chrome Hearts collection ranges in price from $5,000 to $33,000 for the core collection, with prices for the exclusive styles available upon request. The core collection will be available to purchase at Chrome Hearts’ stores in New York, London and Japan, as well as Mikimoto’s stores in Tokyo, New York and Hong Kong.

Anduril, the defense tech company co-founded by Palmer Luckey, is considering building its first major manufacturing plant, a 5-million-square-foot facility known as “Arsenal-1,” in Arizona, Ohio or Texas, according to someone familiar with the matter.

The company, which is developing autonomous drones, planes, and submarines, had announced $1.5 billion at a $14 billion post-money valuation in September.

In conjunction with that round, Anduril announced it plans to use the fresh capital for manufacturing, investing “hundreds of millions” to develop its Arsenal-1 facility. It also said it would use the money for hiring and promised that the facility will employ “thousands of people” and be capable of producing “tens of thousands autonomous military systems annually.”

When TechCrunch asked an Anduril spokesperson if the company was now choosing between these three locations for its factory, she responded “that is incorrect” but would not specify what exactly was incorrect.

Earlier this year, the US Air Force chose Anduril to develop and test small unmanned fighter jets. The company beat out Boeing, Lockheed Martin, and Northrop Grumman for the deal, a significant win for the seven-year-old VC-backed business. (A surveillance aircraft company, General Atomics, was also selected as an awardee to modernize the Air Force fleet.)

Anduril is currently manufacturing its systems in Georgia, Mississippi, Rhode Island, and Australia, according to its website. While these locations are providing the company with “significant manufacturing capacity,” Anduril wants the new facility to become a prototype of a faster, cheaper, software-defined factory for building weapons, one that is able to increase production rapidly and nimbly.

This is in contrast to the kind of typical bespoke defense and aerospace contractor manufacturing today, which makes each part costly to change. Anduril is not the only VC-backed defense tech company working on the manufacturing part of the problem. As TechCrunch previously reported, a group of former Anduril engineers launched a startup called Salient Motion, to do this for the aerospace industry and was promptly sued by Anduril. The suit has since been settled. Others, like Ursa Major, are working on making rocket motors through 3D printing.

Although Anduril’s headquarters are in Costa Mesa, California, and will remain there, our source says, the majority of the company’s staff will likely be based at Arsenal-1. Arizona, Texas, and Ohio are all fairly common sense potential choices, as all are states where defense contractors and other types of manufacturing facilities abound.

Investors in Anduril’s last round include Founders Fund, Sands Capital, Fidelity Management & Research Company, and Baillie Gifford.

Analysts said the ruling was a minor setback in the industry’s push to capitalize on the energy source

Shares of nuclear-power producers fell after regulators dealt a blow to an Amazon AMZN -1.05%decrease; red down pointing triangle.com effort to use more nuclear energy, one of several as technology giants turn to the power source to fuel the rapid development of artificial intelligence.

The Federal Energy Regulatory Commission late Friday blocked a request by Amazon and Talen Energy TLN -4.14%decrease; red down pointing triangle to siphon more electricity from a Pennsylvania nuclear plant to one of the internet retail company’s data centers. Shares of Talen fell as much as 9% early Monday before recovering midday to trade down 3.3%, at $168.15.

Talen said it believed FERC had erred, and that the company was evaluating options with a focus on commercial solutions.

The news hit other nuclear-heavy power companies, whose stocks have surged as Amazon, Alphabet’s Google, Microsoft and other tech companies have inked deals to use carbon-free nuclear power to meet increasing AI-fueled demand for electricity.

Shares of Constellation Energy, which plans to restart Pennsylvania’s Three Mile Island power plant to sell electricity to Microsoft, tumbled 11%, despite the company Monday beating market expectations with its quarterly earnings and boosting its outlook. Shares of Vistra, Centrus Energy, NuScale Power and Public Service Enterprise Group also were hit early Monday.

Despite the negative stock reaction, analysts said FERC’s ruling was a minor setback in the overall industry’s push to capitalize on the around-the-clock energy source amid a heated AI race.

Talen can still restructure its expanded deal with Amazon, according to Oppenheimer analysts, and can already supply some power under the existing agreement. Though the setback creates more potential costs and increases uncertainty, the analysts said they still expect the Amazon Web Services data-center deal will go through.

FERC’s rejection appeared to be more about technical issues than broader policy, UBS analysts said in a research note.

We “believe investors should focus on the strong fundamental backdrop…and see through the noise created by the FERC ruling,” the analysts said.

Nevertheless, Constellation was on pace for the stock’s largest percent decrease on record, and was the worst performer of the S&P 500 as of mid-morning. It recently traded down 11%, at $229.61.

Public Service Enterprise Group also was on track for its largest percent drop since March 2020. Shares were down 5.9%, to $84.45.

Spain’s political leaders turn on each other over flood catastrophe

Blame game begins over failure to alert residents as country suffered its deadliest disaster in decades

Leaders in Spain have begun a blame game over the country’s deadly flood disaster a day after angry survivors hurled mud and insults at politicians and the king as they visited the afflicted area.

Carlos Mazón, head of the Valencia regional government, went on the offensive on Monday by accusing a body run by Prime Minister Pedro Sánchez’s central government of failing to send flood alerts.

Sánchez’s Socialist-led administration hit back, saying Mazón was spreading lies following flash floods that hit Valencia and other parts of southern and eastern Spain last Tuesday.

The row broke out less than 24 hours after both men were pelted with mud as they visited the town of Paiporta in the disaster zone with King Felipe.

Rescuers are still searching for victims in underground car parks inundated with water. Distraught residents, meanwhile, are pleading for help to clean sludge-filled towns that remain strewn with crumpled vehicles and belongings ripped from people’s homes by the deluge.

Mazón, whose conservative People’s party (PP) government is in charge of disaster prevention and relief in Valencia, is under pressure after his civil protection agency failed to send an alert to residents’ phones until after 8pm last Tuesday, when many streets were already under water and some people had perished.

But he sought to turn the tables on the central government on Monday as the confirmed death toll rose to 217, making the floods Spain’s deadliest disaster in decades and one that scientists have linked to climate change.

Mazón said that “no doubt we would have sent the alarm message earlier” if the Valencia government had received an alert from the public body that manages the region’s river basins, which is overseen by the central government. “It would have been done immediately,” he said.

He noted that the public water authority was part of the environment ministry headed by Teresa Ribera, who is likely to become the top Socialist in the European Commission after being nominated as a new competition and environment chief. 

Spanish government officials said Mazón’s comments made no sense and rejected his claim that the water authority had sent three alerts about rivers bursting their banks and then deactivated them.

“The water authorities do not issue warnings. Warnings are issued by the regional emergency services,” said one official. “If the water authorities do not issue alerts, they cannot deactivate them either.”

The role of the public water bodies is to provide information on rainfall and the level of watercourses. Last week’s intense downpours caused rivers to overflow and generated flash floods in a string of towns and villages close to the city of Valencia.

The PP’s national leader Alberto Núñez Feijóo had offered tempered support to Mazón since the floods and on Monday said the disaster should be declared a “national emergency”, which would put central government in charge of the relief effort.

Some of Sánchez’s opponents have accused the Socialists of mismanaging Spain’s dams and reservoirs, a charge the government denies. One news story suggested a Socialist government in 2005 had blocked the construction of a dam that could have protected the disaster zone. Iolanda Mármol, Ribera’s communications director, responded: “This is false and delusional. Stop instrumentalising pain.”

The European People’s party, the EU parliamentary group that includes the PP, has said it will demand answers on the floods.

Sánchez was evacuated from the town of Paiporta in the disaster zone on Sunday amid “attacks and insults” that his office blamed on members of far-right groups. Spain’s interior minister said the premier had been hit in the back by a large stick thrown his way. One government official said those responsible would be brought to justice.

King Felipe continued the visit for more than an hour after Sánchez left. Later the sovereign said: ‘We have to understand the anger and frustration of many people because of the awful time they have had and because of the difficulty of understanding how emergency response mechanisms work.”

One tearful Paiporta resident told Telecinco TV on Monday that the dozens of security officials travelling with the king and political leaders on Sunday “should have come with a damn shovel to help out”.

Barcelona, meanwhile, became the centre of a new bout of torrential rain, with the Catalan regional government issuing a red alert warning people to “exercise extreme caution”.

Dozens of flights were delayed or cancelled as Barcelona airport received a quarter of the rain it normally gets in a year in just four hours, according to the state weather agency.

UK tax plan for wealthy foreigners risks turning London into ‘bigger version of Bahamas’

Advisers warn British government’s proposal to replace non-dom scheme will attract those seeking short-term tax holidays

The UK government’s new regime to attract wealthy foreigners is too short-term and risks turning London into “a bigger version of the Bahamas”, non-doms and their advisers have warned.

Chancellor Rachel Reeves confirmed in her Budget last week the abolition of the non-dom regime, which allows UK tax residents whose permanent home or “domicile” is overseas to avoid paying British tax on their foreign income or capital gains for 15 years.

It will be replaced from April 6 2025 by a four-year residence-based scheme, which Reeves said would provide “internationally competitive arrangements for people coming to the UK on a temporary basis”. 

Under the scheme, new arrivals to the UK will get 100 per cent relief on foreign income and capital gains for their first four years of tax residence, provided they have not been a UK tax resident in any of the 10 consecutive years before their arrival.

But non-doms and their advisers warned that the new scheme is too short-term to attract people who want to make a home in the UK, educate children or build a business there, suggesting that it may attract transient individuals just looking for a tax holiday. 

“A four-year regime will turn the UK into a bigger version of the Bahamas without any meaningful contribution to the Exchequer,” said Christopher Groves, a partner in the private client and tax team at law firm Withers in London, referring to the Caribbean islands that are a popular tax haven because of the absence of corporate and personal income tax and capital gains tax.

Groves suggested that under the UK’s new regime, “people will come to sell their business, reorganise their affairs and disappear again”. 

Other countries have put in place tax breaks as they compete to entice high earners.

For example in Italy, a newly arrived resident — or an Italian who has lived abroad for at least nine years — can pay a flat tax of €100,000 a year on any foreign income and assets for up to 15 years, and be fully exempt from inheritance tax on foreign assets during that period. The annual levy is doubling to €200,000 from next year. France has a special expat tax regime, akin to the UK’s non-dom regime, which provides tax exemptions for eight years.

The UK’s new residence-based scheme “heralds a completely new approach to attracting wealth creators coming to the UK”, said Ashley Crossley, head of the wealth management department at law firm Baker & McKenzie in London. “Short-term and transient rather than the long-term putting down of roots will now characterise the UK’s new wealth model.”

After four years in the UK, individuals who have set up trusts will be taxed on the trust income and capital gains, but the trusts will remain free of 40 per cent inheritance tax. After 10 years their entire global assets will be caught by the UK tax net.

The non-dom regime was put in place in 1799, in part to shelter those with foreign property from wartime taxes. A crackdown on the non-dom regime began under then Conservative chancellor George Osborne; from April 2017 foreign residents who had lived in Britain for more than 15 of the past 20 years were deemed domiciled in the UK.

In March this year, then chancellor Jeremy Hunt stole one of the opposition Labour party’s flagship fiscal policies when he announced the abolition of the non-dom regime.  

Reeves followed with proposals to further toughen the crackdown. In last week’s Budget she pressed ahead with reversing a Tory decision to permit non-doms to permanently shield foreign assets held in an offshore trust from inheritance tax, ignoring warnings that this would spark an exodus.

“Who is going to come here and settle, buy a house, start a business, just to know that in four years’ time they’ll have to run for the hills,” said Magdalena Wierzycka, a Polish-South African billionaire who co-founded financial services company Sygnia in South Africa, and later moved to London in 2018. “They’ll go to Switzerland or Italy or Greece instead.”

After settling in the UK, Wierzycka set up a venture capital firm, Braavos Investment Advisers, in 2019, which works with spin outs from Oxford university to commercialise intellectual property. But following the abolition of the non-dom regime, Wierzycka said she was reluctantly planning to leave the country, largely due to the implications of UK inheritance tax at 40 per cent.

Property advisers expect the non-dom overhaul to have an impact on the real estate market, with new temporary residents in the UK capital choosing to rent rather than buy.

“I suspect some of their demand gets pushed into the rental market, particularly given you’ve got quite a high cost of purchase because of stamp duty,” said Lucian Cook, head of UK residential research at Savills. Those who intended to stay for up to a decade “would probably continue to buy”, he added.

Ministers will increase cap in line with inflation to £9,535 after eight year freeze

University tuition fees in England will rise in line with inflation from next year, as the government tries to address a funding crisis in one of Britain’s most successful sectors.

Education secretary Bridget Phillipson on Monday afternoon announced that tuition fees will increase in line with the retail price index to £9,535 in 2025, the first increase in eight years. Fees have been capped at £9,250 since 2017.

She also announced that the government would raise the maximum maintenance loan, for supporting students’ living costs, by £400 to above £10,000 in the next academic year. But the government has not reinstated maintenance grants, which do not have to be paid back and were abolished in 2016.

The university sector’s finances have been under pressure from rising costs while the freeze on tuition fees has left institutions increasingly dependent on a dwindling pool of international students, particularly from China.

“We will fix the foundations, we will secure the future of higher education so that students can benefit from a world-class education for generations to come,” Phillipson told the House of Commons.

She said the rise in fees had “not been an easy decision”. She added that the move would not cost graduates more each month as they start repaying their loans because repayments are based on earnings, not the outstanding balance.

Carl Cullinane, director of research and policy at the Sutton Trust, noted that raising tuition fees without also reintroducing maintenance grants would “hurt students from the poorest households the most” given that students from lower-income backgrounds had been leaving university with the highest levels of debt and were struggling with repayments.

The Institute for Fiscal Studies said the increase in the size of maintenance loans only partially compensated for real-terms cuts. “Even after the uplift, the poorest students will be entitled to borrow around 9 per cent less next academic year than an equivalent student 5 years earlier,” it added. 

The National Union of Students welcomed the increase to maintenance loans but called for a fundamental review in the way that government finances higher education that takes into account the unaffordability of living expenses for the poorest students.

“Universities cannot continue to be funded by an ever-increasing burden of debt on students,” added Alex Stanley, vice-president for higher education at the NUS, describing the changes as a “sticking plaster”.

Vivienne Stern, head of Universities UK, said that “today’s decision cannot have been easy for government, but it is the right thing to do”.

But Nick Hillman, director of the Higher Education Policy Institute, said universities “need a fee rise that is significantly above inflation even to stand still”, adding the sector faces £400mn of extra costs as a result of increases in employers’ national insurance contributions announced in last week’s Budget.

The Institute for Fiscal Studies said in June that tuition fees should rise with inflation from 2025-26, reaching £10,500 by the end of the decade, to avoid further real-terms funding cuts to the sector.

The cap on fees means universities are losing an average of £2,500 on every domestic student, according to analysis by the Russell Group of leading research universities. 

Labour said in its general election manifesto that higher education was “in crisis” and that the current funding settlement did “not work for the taxpayer, universities, staff, or students”.

More than 50 universities have announced job cuts this year and several are on the verge of bankruptcy, according to Whitehall officials.

Goldman goes to battle