FT : Accor in talks with Dubai Holding to fund Orient Express superyachts

Accor in talks with Dubai Holding to fund Orient Express superyachts
French hotel group’s plan for two superyachts underlines growing Middle Eastern interest in luxury travel sector


French hotel group Accor is in talks with investment vehicle Dubai Holding to fund the roughly €800mn development of two upmarket cruise liners under the Orient Express brand, in the latest example of Middle Eastern investor interest in the luxury travel sector, according to multiple people familiar with discussions.

Since announcing plans to launch two Orient Express-branded superyachts early last year, Accor has been seeking a partner to bankroll the majority of the capital expenditure associated with the cruise liners, in line with its “asset-light” strategy, three people said. Accor is also launching luxury hotels and trains under the Orient Express brand.

Talks have been held with several parties but discussions with Emirati ruler Sheikh Mohammed bin Rashid al-Maktoum’s conglomerate Dubai Holding are at a more advanced stage, the people said. Dubai Holding, which has $35bn worth of assets, owns the Jumeirah luxury hotel chain and last year agreed a deal with Accor to launch hotels in the emirate. Talks may yet fall through, the people added.

The two Orient Express-branded yachts are being constructed by French shipbuilder Chantiers de l’Atlantique and are expected to launch in early 2026 and early 2027 respectively. The first vessel — the 220 metre-long Orient Express Silenseas — has just 54 suites onboard, with tickets costing up to €20,000 per voyage.

Dubai Holding would become the majority owner in the property company behind the yachts, if the deal goes ahead, providing Accor with the benefit of moving the assets off its balance sheet, the people said. State-backed funds in the United Arab Emirates and Saudi Arabia have poured billions of dollars into luxury hospitality in recent years.

Accor and Dubai Holding declined to comment.

Any possible partnership could extend to the Orient Express hotel and train assets, the people added. Accor is restoring 17 original train carriages to be launched on a route named the “Orient-Express-Nostalgie-Istanbul” as well as launching six other train routes and several hotels in Italy under the Orient Express brand in collaboration with Oaktree Capital-backed luxury hospitality group Arsenale.

Accor has made a push into more upscale hospitality in recent years. The hotel group’s luxury and lifestyle division accounted for 43 per cent of revenues last year, up from 39 per cent the year before. The group reported more than €1bn in earnings before interest, taxes, depreciation and amortisation for last year, driven by an 82 per cent like-for-like increase in profits from its upscale segment.

Marriott-owned hotel group Ritz-Carlton launched its own luxury cruise liner last year. Luxury resort operators Aman Resorts and Four Seasons have also announced plans to launch their own cruise ships. Accor paid a total of €44mn to buy the Orient Express brand from state-owned French rail operator SNCF as part of a 2017 deal, according to a person familiar with the matter.

The travel sector continues to benefit from a post-pandemic boom in demand, despite high inflation. The global luxury travel market is projected to grow by 45 per cent between 2023 and 2028 to $2tn, according to market research cited by consultancy Deloitte. The luxury cruise sector is growing three times faster than the industry at large, nearly doubling capacity by 2028, according to an Oxford Economics report from last September.

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>>> US After Hours Summary: PUBM +31.9%, HIMS +19%, TREX +8% up big on earnings;

After Hours Summary: PUBM +31.9%, HIMS +19%, TREX +8% up big on earnings; AAN -28.2%, U -16.4%, WDAY -8.9% selling off following quarterly results

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: PUBM +31.9%, HIMS +19%, TMDX +16.4%, EVER +15.9%, TREX +8%, HLIO +7.8%, AIN +6.3%, RLJ +5.3%, AEP +3.4% (appoints interim CEO), STRL +3.2%, SKYT +2.9%, PRIM +2.8%, IIPR +2.5%, IRBT +1%, ADUS +0.4%, CPE +0.3%, DRQ +0.1%

Companies trading higher in after hours in reaction to news: JANX +95.4% (announces encouraging data from trials), CDXS +20.3% (licensing agreement with Roche), AMH +3.6% (replacing DOC in S&P MidCap 400), AWR +2.4% (files common share offering), RCM +2.2% (Coliseum capital issues open letter to board), SCLX +1.8% (enters into term sheet with Virpax Pharmaceuticals), TCBK +1.4% (increases dividend), SITM +0.6% (files mixed shelf), GILD +0.2% (FDA approves expanded indication for Biktarvy), EXPE +0.2% (reducing workforce by 1,500), DOC +0.1% (to be replaced by AMH in S&P MidCap 400)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: AAN -28.2%, U -16.4%, SIBN -12.4%, CARG -11.7%, WDAY -8.9% (acquiring HiredScore), PWSC -8.3%, ACHR -6.6%, FATE -6.3%, ASUR -5.6%, STAA -3.9%, EFC -3.2% (cutting monthly dividend), DDS -1.3%, SBAC -1.2%, FSK -0.9%, RVMD -0.4%, OKE -0.4%, HEI -0.3%, AES -0.3%, EVBG -0.1%

Companies trading lower in after hours in reaction to news: FGEN -13.5% (regains rights to Roxadustat), FIVN -4.3% (convertible notes offering), PRGS -3.2% (convertible notes offering), UVSP -2.8% (files mixed shelf), HES -2.7% (files mixed shelf), DLTR -1.9% (resolves DoJ investigation), SHAK -1.4% (restatements of prior financial statements), NWBI -1.2% (appoints new CFO), NOVA -1.1% (appoints new COO), LAAC -1% (appoints new CEO), AL -0.7% (long-term lease agreements for Boeing aircraft), PEAK -0.6% (completes consent solicitation), NTB -0.6% (files mixed shelf), CDE -0.2% (advancing Silvertip exploration), XOM -0.2% (may match CVX's price offered to HES, according to WSJ)

WSJ : Iran Reduces Near Weapons-Grade Stockpile, Defying Expectations

Iran Reduces Near Weapons-Grade Stockpile, Defying Expectations
Country still has enough weapons-grade material for several nuclear weapons

VIENNA—Iran reduced its stockpile of near weapons-grade nuclear material over the past 3½ months, the United Nations’ atomic watchdog said Monday, a surprise step likely to be welcomed by Western countries who have been alarmed by Iran’s buildup of highly enriched nuclear fuel.

Iran still has enough near-weapons grade material to fuel almost three nuclear weapons, underlining its status as a threshold nuclear-weapon state. However, by diluting some of its 60% enriched uranium in recent weeks to lower-grade material, its stockpile fell for the first time since it started producing the 60% nuclear fuel in 2021.

Iran’s decision to reduce its stockpile of 60% nuclear fuel comes as Iranian-backed militias are involved in clashes throughout the Middle East with Israel and the U.S., from Yemen’s Houthi attacks on international vessels in the Red Sea to Israel’s clashes with Hezbollah on its northern border and conflict with Hamas in Gaza.

It also comes as Washington and its European partners have floundered over how to respond to Iran’s expanding nuclear program.

In its confidential quarterly report, sent to member states on Monday, the International Atomic Energy Agency said Iran had reduced its stockpile of 60% enriched uranium by 6.8 kilograms to 121.5 kilograms since late October.

U.S. officials say it would take Iran less than two weeks to convert that amount into weapons grade material, roughly 90%. Tehran is the only nonnuclear weapons state producing 60% enriched uranium.

By the IAEA’s definition, Iran needs a minimum of 42 kg of uranium enriched to 60% to make a nuclear bomb.

Iran continued to build up its stockpile of lower-purity enriched uranium. It added 145.1 kilograms to its stockpile of 20% enriched uranium which experts say could be increased to weapons grade level within several weeks. Uranium enriched to around 90% can be used to fuel nuclear bombs. Iran now has 712 kilograms of 20% enriched uranium.

Iran says its nuclear program is purely for peaceful purposes. U.S. officials have said Iran could field a nuclear weapon within several months.

The Biden administration has upheld longstanding U.S. policy of pledging that it will prevent Iran from attaining a nuclear weapon.

The reduction in 60% enriched uranium will offer some respite to the U.S. and its European partners who have grown increasingly concerned about the expansion of Iran’s nuclear program.

The Biden administration failed in its efforts to revive the 2015 nuclear deal with Iran, which lifted international sanctions on Tehran in exchange for tight but temporary limits on its nuclear work. So did an attempted de-escalation effort last year which grew out of indirect discussions between senior U.S. and Iranian officials in Oman.

The indirect talks ended after the Hamas terrorist attack on Israel on Oct. 7, which killed 1,200 people, mostly civilians. Tehran praised the attack.

Iran had slowed its production of 60% enriched uranium last year as part of its de-escalation efforts. However, Iran reversed that slowdown in November, the agency said late last year.

In recent weeks, Iran twice carried out a process of diluting the material by mixing it with low-grade 2% enriched uranium.

FT : Microsoft strikes deal with Mistral in push beyond OpenAI

Microsoft strikes deal with Mistral in push beyond OpenAI
Tech giant unveils partnership with French AI start-up, as regulators probe $13bn alliance with ChatGPT maker

Microsoft has struck a deal with French artificial intelligence start-up Mistral as it seeks to broaden its involvement in the fast-growing industry beyond OpenAI.

The agreement, announced by Mistral on Monday, will involve the US tech giant helping to bring its AI models to market.

Microsoft will also take a minor stake in the 10-month-old Paris-based company, although the financial details have not been disclosed.

The partnership makes Mistral the second company to provide commercial language models available on Microsoft’s Azure cloud computing platform.

“Microsoft’s trust in our model is a step forward in our journey to put frontier AI in everyone’s hands,” said Arthur Mensch, cofounder and CEO of Mistral AI.

Microsoft has already invested about $13bn in San Francisco-based OpenAI, an alliance that is being reviewed by competition watchdogs in the US, EU and UK.

Other Big Tech rivals, such as Google and Amazon, are also investing heavily in building generative AI — software that can produce text, images and code in seconds — which analysts believe has the capacity to shake up industries across the world.

Mistral, which builds large language models, the underlying technology that powers generative AI products, secured a €2bn valuation in December in a funding round worth roughly €400mn.

Its models are “open source”, meaning technical details will be released publicly.

This contrasts with the approach of competitors such as ChatGPT maker OpenAI, whose latest model GPT-4 is a so-called black box in which the data and code used to build the model are not available to third parties.

OpenAI was estimated to be worth $86bn during its recent secondary share sale last year.

TechCrunch : Mistral AI releases new model to rival GPT-4 and its own chat assis

Mistral AI releases new model to rival GPT-4 and its own chat assistant

Paris-based AI startup Mistral AI is gradually building an alternative to OpenAI and Anthropic as its latest announcement shows. The company is launching a new flagship large language model called Mistral Large. When it comes to reasoning capabilities, it is designed to rival other top-tier models, such as GPT-4 and Claude 2.

In addition to Mistral Large, the startup is also launching its own alternative to ChatGPT with a new service called Le Chat. This chat assistant is currently available in beta.

If you’re not familiar with Mistral AI, the company is better known for its capitalization table as it raised an obscene amount of money in very little time to develop foundational AI models. The company was officially incorporated in May 2023. Just a few weeks after that, Mistral AI raised a $112 million seed round. In December, the company closed a $415 million funding round with Andreessen Horowitz (a16z) leading the round.

Founded by alums from Google’s DeepMind and Meta, Mistral AI originally positioned itself as an AI company with an open-source focus. While Mistral AI’s first model was released under an open-source license with access to model weights, that’s not the case for its larger models.

Mistral AI’s business model looks more and more like OpenAI’s business model as the company offers Mistral Large through a paid API with usage-based pricing. It currently costs $8 per million of input tokens and $24 per million of output tokens to query Mistral Large. In artificial language jargon, tokens represent small chunks of words — e.g., the word “TechCrunch” will be split in two tokens “Tech” and “Crunch” when processed by an AI model.

By default, Mistral AI supports context windows of 32k tokens (generally more than 20,000 words in English). Mistral Large supports English, French, Spanish, German and Italian.

As a comparison, GPT-4 with a 32k-token context window currently costs $60 per million of input tokens and $120 per million of output tokens. So Mistral Large is currently 5 to 7.5 times cheaper than GPT-4-32k. Things are changing at a rapid pace and AI companies update their pricing regularly.

But how does Mistral Large stack up against GPT-4 and Claude 2? As always, it’s very hard to tell. Mistral AI claims that it ranks second after GPT-4 based on several benchmarks. But there could be some benchmark cherry-picking and disparities in real-life usage. We’ll have to dig more to see how it performs in our tests.

An alternative to ChatGPT
Mistral AI is also launching a chat assistant today called Le Chat. Anyone can sign up and try it out on chat.mistral.ai. The company says that it is a beta release for now and that there could be “quirks”.

Access to the service is free (for now) and users can choose between three different models — Mistral Small, Mistral Large and a prototype model that has been designed to be brief and concise called Mistral Next. It’s also worth noting that Le Chat can’t access the web when you use it.

The company also plans to launch a paid version of Le Chat for enterprise clients. In addition to central billing, enterprise clients will be able to define moderation mechanisms.

A partnership with Microsoft
Finally, Mistral AI is also using today’s news drop to announce a partnership with Microsoft. In addition to Mistral’s own API platform, Microsoft is going to provide Mistral models to its Azure customers.

It’s another model in Azure’s model catalog, which doesn’t seem that big a deal. And yet, it also means that Mistral AI and Microsoft are now holding talks for collaboration opportunities and potentially more. The first benefit of that partnership is that Mistral AI will likely attract more customers with this new distribution channel.

As for Microsoft, the company is the main investor of OpenAI’s capped profit subsidiary. But it has also welcomed other AI models on its cloud computing platform. For instance, Microsoft and Meta partner to offer Llama large language models on Azure.

This open partnership strategy is a nice way to keep its Azure customers in its product ecosystem. It might also help when it comes to anticompetitive scrutiny.