TheChek News Flow

>>> What to look at today - 25th, 26th & 27th of December 2023

Shares rose across Asia after gains on Wall Street pushed the S&P 500 near its record high, as investors bet that the Federal Reserve will cut interest rates as early as March. The MSCI Asia Pacific Index jumped as much as 0.9%, set for the highest close in over four months. Australia’s S&P/ASX 200 index hit its highest intraday peak since April 2022, fueled by gains in miners amid rising iron ore prices, as markets reopen after a long weekend. Hong Kong stocks also advanced after returning from the holiday break, led by Chinese tech firms after Beijing softened its stance on the gaming industry following a stock selloff sparked by proposed curbs. Equities in Shanghai and Shenzhen rebounded from earlier losses, after data showed a quickening speed of growth in the country’s industrial profits helped by favorable base effects.

US futures were virtually flat after the S&P 500 closed Tuesday within 0.5% of its record high, achieved early last year when interest rates remained at pandemic lows. US stocks have risen 4.5% this month so far, with the gain since the start of the year now 24%. The dollar is steady against most major currencies. 10-year Treasury yields fell 2 basis points in Asia trading after Tuesday’s auctions drew buyers as the market prices in an aggressive path of Fed easing in 2024. Japan’s Nikkei 225 index rose over 1%, marching toward a closing level near its 34-year high, after Bank of Japan board members discussed the potential timing of ending the negative rate policy during their meeting last week, with several members indicating they see no rush to make the move. The yen weakened slightly and Japanese government bond yields fell after the release of the summary. In Hong Kong, major tech stocks partially recovered from Friday’s $80 billion rout, after authorities signaled a willingness to dial back controversial new gaming restrictions. Tencent climbed as much as 4.9% while smaller rival NetEase jumped more than 14%. While the US and Australian indexes near record highs and Indian gauges hover near all-time peaks from earlier this month, MSCI’s all-country index is 4.5% off its November 2021 record. Asia is a laggard region, with the MSCI Asia-Pacific Index still 25% off its February 2021 high. Elsewhere, oil reversed gains after rising tensions in the Middle East, with a fresh attack on shipping in the Red Sea prompting vessels to avoid the key shipping route. Gold was little changed, while Bitcoin held a retreat as traders assessed how crypto markets might react if regulators meet expectations by approving the first US exchange-traded funds investing directly in the token. Also in the corporate world, SoftBank Group saw the biggest intraday gain since June 13, after announcing it will receive $7.6b worth of T-Mobile US shares without additional costs. US After Hours Quiet session; CHRS +24.3% surging on FDA approval news; LTH -4.9% down on CFO resignation.

Nikkei +1.13% Hang Seng +1.82% CSI +0.42% Shanghai +0.61% Shenzen +0.61%

Eur$ 1.1041 CNH 7.1502 CNY 7.1479 JPY 142.66 GBP 1.2729 CHF 0.8535 RUB 92.3211 TRY 29.3208 WTI$ 75.40 Gold 2,065 BTC 42,286 -0.15% ETH 2,220 -0.10%

S&P +0.06% Nasdaq +0.06% EuroStoxx +0.59% FTSE +0.56% Dax +0.47% SMI

Macro :

- Sam Altman, Jony Ive Enlist Apple Veteran to Work on AI Devices

- Bank of Russia Governor Says She Is Bracing for More Sanctions

- US Says Red Sea Patrol Will Be Able to Thwart Houthi Attacks

- Germany’s Coal Phase-Out Plan Is Unrealistic, Lobby Chief Says

- Trump Tells Appeals Panel He Should Have ‘Absolute Immunity’

- Brazil Must Weigh Oil Output and Exploration Cap, Silva Tells FT

Keep on eye on :

- ABI BB : Brazil’s Marcel Telles Donates AB InBev Stake to Son Max: Filing

- ABN NA : Neuflize Vie Sale Draws Bids From AG2R, Cardif, Les Echos Says

- AA/ LN : Stonepeak Partners to Invest in Breakdown Coverage Firm AA

- AAL LN : Anglo American to sell share in $9bn UK mining project

- ANSS US : Engineering Software Firm Ansys Said to Weigh Sale

- AAPL US : Reportedly asked some of its supply chain partners in Taiwan and South Korea to help accelerate the development of its first foldable iPhone model; May launch as soon as end-2024 or during 2025 - Taiwanese press

- AZN LN : AstraZeneca to Buy Gracell for up to $1.2b in Transaction Value

- CS FP : Neuflize Vie Sale Draws Bids From AG2R, Cardif, Les Echos Says

- BAYN GY : Germany’s Bayer Says it Won a Roundup Cancer Trial in California

- BA/ LN : Japan Mulls Exporting 155mm Artillery Shells to the UK: FT

- BNP FP : Neuflize Vie Sale Draws Bids From AG2R, Cardif, Les Echos Says

- CIFR US : Bitcoin Miner Cipher Rallies Most Since March on Elevated Volume

- CYTK US : *CYTOKINETICS SETS WEDNESDAY CALL TO REVEAL PHASE 3 TRIAL DATA

- DTE GY : SoftBank Surges 7% After Getting $8 Billion of T-Mobile Stock

- ELUXB SS : Electrolux Completes $35 Million Memphis Factory Divestment

- EURN BB : Euronav to Buy CMB.TECH for $1.15 Billion in Cash

- ISS DC : ISS Sells French Business to Onet

- MSFT US : OpenAI in Talks for New Funding at $100 Billion Valuation

- KN FP : H2O Says It ‘Vigorously’ Contests French Lawsuit Allegations

- NVG PL : Portugal’s Navigator Gets €115m Green Loan From the EIB

- PRX NA : Prosus Tumbles as China Tightens Gaming Rules: EMEA Tech Wrap

- RNO FP : France to Cut EV Subsidy Due to Budget Constraints: Les Echos

- REP SM : Spain Watchdog Probes Repsol Over Abuse in Wholesale Gas Market

- SDRL NO : Seadrill Gets Drillship Orders Worth $1.1 Billion from Petrobras

- STLAM FP : France to Cut EV Subsidy Due to Budget Constraints: Les Echos

- SSYS US : Stratasys Confirms Unsolicited Proposal From Nano Dimension

- SNPS US : Synopsys Sinks on WSJ Report of Talks to Buy Ansys

- SDRY LN : Superdry to offload US brand rights in scramble to shore up finances

- TSLA US : Berlin Researchers Crack Tesla’s Autopilot System, Spiegel Says

- TTE FP : TotalEnergies Buys 50% Stake in Adani Green Unit for $300M

- UBI FP : Ubisoft Says It’s Probing a Possible ‘Data Security Incident’

- UCB BB : UCB Says Bimzelx Gets Approval in Japan

- VWS DC : Vestas Gets 603 Megawatt US Order for V163-4.5 MW Turbine

- VWS DC : Vestas Gets 254 MW Order in Australia

- YNDX US : Bank of Russia Registers Yandex’s Local Shares: IFX

>>> Europe : Brokers Upgrades & Downgrades - 25th, 26th & 27th of December 2023

>>> Up

* Bioretec Raised to Buy at Inderes; PT 2.80 euros

* CureVac Raised to Buy at Kempen & Co; PT $10

>>> Down

* Dont Nod Entertainment Cut to Add at Gilbert Dupont

* Idorsia Cut to Sell at Kempen & Co; PT 1.60 Swiss francs

* Oncopeptides Cut to Neutral at Kempen & Co; PT 12 kronor

* Terveystalo Cut to Accumulate at Inderes; PT 8.50 euros

* UPS Cut to Neutral at Daiwa; PT $155

* Xbrane Biopharma Cut to Neutral at Kempen & Co; PT 20 kronor

>>> Initiation

* BMW Rated New Outperform at CICC; PT 120 euros

>>> Call

(BFW) Berlin Researchers Crack Tesla’s Autopilot System, Spiegel Says

9to5 : Slopes ski and ride tracking iOS app gets live lift and trail status info

Slopes ski and ride tracking iOS app gets live lift and trail status info for 50+ resorts

Earlier this month, Apple Design Award-winning ski and ride tracking app Slopes got 3D interactive maps, improved search, and more. Now, in a surprise update, Slopes on iOS is getting live lift and trail status details for more than 50 resorts in the US and Canada.

The Slopes team shared about the valuable new update in a blog post today – saying that the plan was originally to launch it next year, “but honestly, it’s such a killer feature [they] simply couldn’t wait.”

Available to test now for iOS Slopes Premium riders, the new “Live Lift & Trail Status” feature is viewable “directly on the recording screen, and anytime on the interactive maps in the Resorts tab.”

In a neat touch, closed trails will be grayed out, and a trail/lift status filter will be accessible as a layer in map settings.

This is an experimental feature with limited rollout on iOS, so let us know what you think, what you want to see, for when we bring it to the entire platform (Android included), with more resorts.

Slopes is a free download from the App Store with no ads and includes unlimited tracking, key stats/summaries, snow conditions, season/lifetime overviews, and the ability to find your friends on the mountain, plus Siri and HealthKit support.

Available from a $3.99 single pass to a $29.99 per year subscription (and $49.99 per year family subscription), Slopes Premium “unlocks stats for every run and powerful insights into your performance. You can navigate resorts with ease on interactive trail maps, search for runs and lifts, replay your day in 3D & AR, get fitness insights when you record with Apple Watch, and more.”

As mentioned above, Slopes Premium on iOS is required for live lift and trail status info. Here are the resorts where the new feature is available for now:

Alpine Meadows
Arapahoe Basin
Aspen Highlands
Aspen Mountain
Aspen Snowmass
Beaver Creek
Big Boulder
Big Sky
Bogus Basin
Breckenridge
Brighton
Buttermilk
Chestnut Mountain Resort
Copper Mountain
Crested Butte
Crystal Mountain
Deer Valley
Eldora
Heavenly
Holiday Valley
Hunter Mountain
Jack Frost
Jackson Hole
Keystone
Killington
Kirkwood
Loon Mountain
Loveland
Mad River
Mammoth Mountain
Mount Bachelor
Mount Snow
Mount Sunapee
Mt. Brighton
Mt. Hood Meadows
Okemo
Palisades Tahoe
Park City
Pico Mountain
Seven Springs
Snowbasin
Snowbird
Snowshoe
Solitude Mountain
Steamboat
Stevens Pass
Stowe
Stratton Mountain
Sugarbush
Sugarloaf
Summit at Snoqualmie-Central
Sunday River
Telluride
Vail
Whitefish
Winter Park
Blue Mountain, Canada
Mont Tremblant, Canada
Revelstoke, Canada
Whistler Blackcomb, Canada

TechCrunch : Hackers stole $2 billion in crypto in 2023, data shows

Hackers stole $2 billion in crypto in 2023, data shows

But for the first time since 2020, the amount stolen in crypto hacks is trending downwards

For yet another year, hackers stole billions of dollars in crypto. But for the first time since 2020, the trend is downwards, according to crypto security firms.

This year, hackers stole around $2 billion dollars in crypto across dozens of cyberattacks and thefts, according to De.FI, the web3 security firm that runs the REKT database. The site ranks the worst-ever crypto hacks, from the breach of the Ronin network in 2022, where hackers stole more than $600 million in crypto in what stands as the largest incident in history, to the hack against Mixin Network this year, which netted the hackers around $200 million.

“This amount, though dispersed across various incidents, underscores the persistent vulnerabilities and challenges within the DeFi ecosystem,” De.Fi wrote in its report, which the firm shared with TechCrunch. “2023 stood as a testament to both the ongoing vulnerabilities and the strides made in addressing them, even as interest in the space was relatively muted by the ongoing bear market in the first half of the year.”

Earlier in December, blockchain intelligence company TRM Labs also released an estimate of the amount of crypto stolen by hackers this year. According to the company, the total as of mid-December stood at about $1.7 billion.

Among the other worst crypto thefts of the year include the hack against Euler Finance, in which hackers stole almost $200 million; as well as major hacks against Multichain ($126 million), BonqDAO ($120 million), Poloniex ($114 million) and Atomic Wallet ($100 million), among hundreds of others.

Last year, blockchain monitoring firm Chainalysis reported that cybercriminals had stolen an all-time record of around $3.8 billion in crypto. Of those, $1.7 billion were stolen by North Korean government hackers known as Lazarus Group, one of the most prolific groups of crypto thieves, as part of an effort to fund the regime’s sanctioned nuclear weapons program.

“It isn’t a stretch to say that cryptocurrency hacking is a sizable chunk of the nation’s economy,” Chainalysis said in its report last year.

The year before, hackers stole $3.3 billion in 2021, according to Chainalysis,

It’s impossible to predict what will happen in 2024. But given the poor security implemented by many crypto and web3 projects and the sheer amount of monetary value they hold as discussed earlier this year at TechCrunch Disrupt, we can expect hackers to continue targeting the growing industry.

WSJ : How China Manages Its Currency—and Why That Matters

How China Manages Its Currency—and Why That Matters

It isn’t just about economics. The yuan has a political and psychological importance too.

China’s approach to its currency is a mix of bold ambition and fear of dollar strength.

The yuan has lost more than 3% of its value against the greenback this year and was doing even worse before the dollar slipped against most global currencies in November. The yuan traded around 16-year lows against the dollar in September. A dollar now buys around 7.15 yuan.

A weak currency should be good news for an economy that is sometimes called the world’s factory floor. China exported around $3.7 trillion of goods and services in 2022, more than any other country, according to World Bank data. A weaker yuan makes Chinese products cheaper to the rest of the world, which should boost demand. But that is only half the story.

China’s currency has a political as well as economic importance. The U.S. labeled China a currency manipulator in 2019, escalating a trade war between the two superpowers. China has had ambitions for years to promote the international use of its currency, presenting a long-term challenge to dollar dominance.

The value of the yuan is also seen by many people inside and outside the country as a sign of confidence in China’s economy, which is suffering from a moribund real-estate market, a slowdown in manufacturing and a reluctance by consumers to spend big. Foreign investors have pulled out of China’s stock markets this year, and small investors in the country are nervous.

“The central bank’s worry is that currency weakness will exacerbate negative sentiment among foreign investors and domestic ones,” said Alvin Tan, head of Asia foreign-exchange strategy at RBC Capital Markets.

This all means that the yuan is almost certain to remain in the spotlight next year. Here is a guide to how China manages its exchange rate.

The yuan is really two currencies

Beijing operates a novel currency system that combines an onshore yuan and a more freely traded offshore version.

The People’s Bank of China allows the onshore yuan’s value to be dictated by market forces—within limits. Each morning, the China Foreign Exchange Trade System, a unit of the central bank, publishes a reference rate for the yuan against a variety of currencies, although the dollar rate gets most of the attention. It is then allowed to trade 2% above or below that level during the day. The offshore yuan trades without restrictions.

The gap between the two exchange rates offers a sign of how far the market’s perception of China’s economy—and the value of its assets—is diverging from the official view. In October, the difference between the offshore and onshore yuans spiked due to a surge in U.S. government bond yields and rising concerns about China’s economic slowdown.

“While the currency has stabilized, the gap itself is an indication that the market is still not really gung ho, not too sure about the currency and by extension, the economy,” said Sim Moh Siong, a currency strategist at the Bank of Singapore.

The central bank has a lot of tools

The central bank has taken multiple steps to prop up the value of the yuan this year, including allowing banks to hold less foreign currency in reserve and making it harder for them to buy dollars.

One of the PBOC’s most closely watched policy tools is where it sets the onshore yuan’s daily reference rate against the dollar, known as the fixing. From late June to November, the fixing was consistently set at a stronger yuan rate than market participants expected. That sent a clear signal that the central bank wasn’t willing to let the currency plunge to new lows against the dollar this year, said Ju Wang, head of Greater China foreign-exchange and rates strategy at BNP Paribas.

The currency’s weakest point this year was in September when a dollar bought around 7.36 offshore yuan.

The central bank uses something it calls the discretionary countercyclical factor, a number it adds to—or subtracts from—its idea of the fair daily fixing to push back against large moves in the market. The PBOC has kept quiet on whether it has used the factor this year, but after a long period of stronger-than-expected fixings, many strategists think it has.

Chinese authorities take a less formal approach in the offshore market. The government and state-owned enterprises issue yuan-denominated bonds in Hong Kong that suck up liquidity, and sometimes state-owned banks wade into the market to reduce the supply of offshore yuan, supporting the currency, according to analysts.

But it also has bigger fish to fry

The easiest way for central banks to boost the value of their currencies is to raise interest rates since higher rates lead to more demand for assets in a country, which in turn boosts demand for the currency. But the PBOC has cut rates this year in an attempt to prop up the faltering economy.

That has exacerbated the impact of the historic rise in U.S. interest rates. U.S. government bonds now offer much higher yields than those in China, a major reason for the yuan’s poor performance against the dollar this year. But the pressure is easing. In November, foreign investors scooped up yuan-denominated bonds again, partly driven by expectations of lower U.S. rates.

Economists increasingly think the U.S. Federal Reserve is done with its campaign of interest-rate increases, and the dollar has recently weakened against a variety of currencies as a result. That is helping bolster confidence at China’s central bank, which is allowing the market to influence the currency more, said Craig Chan, global head of foreign-exchange strategy at Nomura. That includes setting daily fixings that track market expectations more closely.

Still, a more hands-off approach by the central bank may just lead to more yuan weakness, said Chan.

China has bold ambitions for the yuan

The dollar is the world’s global reserve currency and is on one side of around 90% of foreign-exchange transactions, according to the Bank for International Settlements. This gives the U.S. a huge advantage over other countries, sometimes referred to as the “exorbitant privilege.” China has taken steps to erode that advantage, attempting to promote the use of the yuan across the world.

Foreign banks already accept offshore yuan deposits, and their customers can use this money to buy yuan-denominated stocks and bonds outside of mainland China. Chinese leader Xi Jinping has been courting governments in the Middle East and pushing them to accept yuan payments for oil. Russia already accepts yuan for some of its oil shipments.

The yuan was the world’s fourth-most used payment currency in value terms at the end of November, overtaking the Japanese yen for the first time since January 2022, Swift data shows. The Chinese currency was used for around 4.6% of payments, the result of a multiyear rise and its largest share since Swift started compiling the data in 2010.

But it is going to be a long time before the dollar is under threat. The greenback was used for around 47% of the world’s payments in November.

FT : Chinese gaming stocks regain some ground as Beijing softens rhetoric

Chinese gaming stocks regain some ground as Beijing softens rhetoric

Regulators act to ease concerns after new industry guidelines cause big sell-off

Chinese gaming stocks regained some ground on Wednesday after Beijing appeared to soften its rhetoric on the sector in the wake of new regulations for the world’s biggest gaming market that triggered a record sell-off last week.

Shares in Tencent had tumbled more than 12 per cent on Friday after regulators rocked markets with a plan to curb how much money and time adults spend while playing online games — a reminder to investors of the risks from unpredictable policies in the world’s second-biggest economy.

But they clawed back some of those losses, rising more than 5 per cent in Hong Kong on Wednesday, in their first trading session after official rhetoric appeared to soften Beijing’s stance. Rival NetEase rose about 10 per cent after closing the previous session down almost a quarter.

After Friday’s rout, the National Press and Publication Administration, China’s gaming regulator, sought to assuage concerns, approving the release of a batch of new games and stating on Saturday that it would study responses to its plans to curb how gaming is monetised, and support “healthy development” of the industry.

Zhang Xueqing, an analyst from China International Capital Corporation, a leading Chinese brokerage, said the regulator’s statement should “soothe the concerns of capital markets” and showed a more “gentle” attitude on the part of Beijing.

However, analysts and fund managers said the weak recovery highlighted concerns about policy uncertainty in China.

Liqian Ren, who manages China investments at WisdomTree Asset Management, a US-based fund, said that many China-focused investors had concentrated on macro trends in housing and consumption, and had taken “on this narrative” that regulatory risk for tech platforms had subsided. In this context, Friday’s announcement had been a big shock.

“People are definitely reassessing how much discount should be given for these sudden regulations . . . the sell-off is part of this broader reassessment,” she said. “Capital markets just do not like surprises.”

Robin Zhu, a gaming sector analyst with Bernstein in Hong Kong, described Friday’s sell-off in a note as “The Nightmare Before Christmas”, and warned that the impact on smaller game developers could be worse than bigger groups such as Tencent and NetEase.

Many smaller groups ceased operations when Beijing stopped approving new gaming licences for almost a year in 2021. “It wouldn’t surprise us if a strict implementation of [Friday’s] consultation draft has a similar impact (perhaps it’s a good thing youth unemployment numbers are no longer published),” he wrote.

Zhu added that while markets had probably overreacted to Friday’s proposals, “almost any reaction feels justifiable in the present moment, given the vagueness of the consultation draft, and Chinese policymakers’ track record in the last few years”.

China’s online gaming industry is the biggest in the world with annual revenues of about $45bn from 650mn users.

Morgan Stanley analysts were less concerned about the hit to the sector. They said in a note that over the past five years, regulators have slowed the pace of new game releases, restricted content and curbed use by minors. However, the wave of regulations has ultimately had “minimal impact on the industry”, which has seen revenues surge almost 50 per cent since 2017, from Rmb204bn ($28.5bn) to Rmb305bn this year.

The bank’s analysts added that big companies, through “innovation” or “workarounds”, could mitigate the risk from the latest regulatory proposals.

Still, China’s stock market has sharply underperformed global peers this year on the back of a disappointing economic recovery from years of harsh zero-Covid restrictions and a rolling liquidity crisis among systemically important property developers. The MSCI China index is set to finish the year down more than 17 per cent, compared to a rise of more than 24 per cent for the S&P 500 in the US.

Gary Ng, a senior economist at investment bank Natixis, said the latest gaming regulations have “sparked fear” among investors that the period of regulatory crackdowns is not over, denting China’s efforts to bring in more foreign investment.

“It may be boring to talk about policy risk again and again, but this is really the core factor behind the weak sentiment in Hong Kong and China-related assets, especially equities,” he said, adding: “Why would investors return from Asian markets, like Japan and India, if they all have a better story to tell?”

CrunchBase : The Biggest Of The Big: AI Startups Raised Huge — These Were The La

The Biggest Of The Big: AI Startups Raised Huge — These Were The Largest Deals Of 2023

Artificial intelligence was big in 2023 — and that could be the understatement of the year.

For a time — especially in the middle of the year — it seemed like nine-figure rounds were being thrown out by investors every week to the latest and greatest AI startup. Sometimes, there were so many huge rounds it was hard to keep track.

However, that’s why we’re here. Per Crunchbase data, there were eight deals of at least a half-billion dollars or more consummated this year involving AI startups. Let’s take a look at the biggest deals and who invested.

1. OpenAI, $10B: Obviously, we have to start with this one — which was a harbinger of things to come in 2023. Officially, Microsoft simply said it had agreed to a “multiyear, multibillion-dollar investment” into OpenAI, but several reports tabbed it as a $10 billion deal. That followed an earlier $1 billion Microsoft investment in the AI startup. The deal also marked Microsoft — and OpenAI — as dominant players in the AI space, with other tech giants such as Alphabet and Amazon needing to play catchup.

2. Anthropic, $4B: San Francisco-based Anthropic raised nearly $7 billion in funding this year alone — so it was busy. However, this September round was the largest. The ChatGPT rival inked a deal with Amazon for the e-commerce and cloud titan to invest up to $4 billion in the AI startup. The new investment gives Seattle-based Amazon a minority stake in Anthropic. The immediate investment is $1.25 billion, with either party having the right to trigger another $2.75 billion in funding, Reuters reported. As part of the deal, Anthropic will now use Amazon Web Services data centers, as well as AWS Trainium and Inferentia chips to build, train and deploy its models. No valuation was given with the round.

3. Anthropic, $2B: Like we said earlier, Anthropic was busy this year. This was the company’s second-biggest deal of the year. According to a WSJ report, previous investor Google agreed to invest up to $2 billion in the OpenAI competitor. The deal includes $500 million upfront and an additional $1.5 billion more over time, per the report. In February, it also was reported that Google had invested between $300 million and $400 million in the startup.

4. Inflection AI, $1.3B: In June, Palo Alto, California-based Inflection AI locked up a huge $1.3 billion round led by Microsoft, Reid Hoffman, Bill Gates, Eric Schmidt and new investor Nvidia, which valued Inflection AI at $4 billion, according to Forbes. The startup is building what it says will be the “largest AI cluster in the world” and has created large language models to allow people to interact with its AI-powered assistant called Pi, or Personal AI. Pi lets people quickly receive relevant information and advice on their interests. Founded in 2021, the generative AI platform is a competitor to other AI firms such as OpenAI and Google. It was co-founded by Mustafa Suleyman, who previously co-founded the Google-owned AI lab DeepMind and serves as CEO at Inflection.

5. Metropolis, $1.1B: Isn’t this a parking startup? Well yes, but it uses computer vision and AI in its offering so we’re including it. The Los Angeles-based checkout-free parking startup raised $1.7 billion in debt and equity led by Eldridge and 3L Capital. The company raised $1.05 billion through a Series C offering and $650 million of debt financing. The money was used to take logistics firm SP Plus private in a deal worth approximately $1.5 billion — the biggest M&A transaction of the year by a VC-backed company, per Crunchbase data. It even beat out Databricks’ purchase of San Francisco-based language models training startup MosaicML for $1.3 billion in June.

6. Databricks, $685M: Also not a pure-play generative AI firm, Datbricks makes the list. The AI-enhanced data analytics company raised more than a big Series I led by funds and accounts advised by T. Rowe Price Associates. The deal — approximately $685 million, per a filing — values the company at $43 billion, a boost from the $38 billion valuation San Francisco-based Databricks received after raising a $1.6 billion Series H led by Morgan Stanley’s Counterpoint Global in 2021. The new round also included chip-making giant Nvidia — which has been busy of late investing in AI startups. During its second quarter, the company said it passed the $1.5 billion revenue run rate at more than 50% revenue year-to-year growth.

7. (tied) Aleph Alpha, $500M: Germany-based Aleph Alpha raised a $500 million Series B as AI startups outside the U.S. continued to see bigger rounds as the year wore on. The round was led by Innovation Park Artificial Intelligence, Bosch Ventures and the companies of Schwarz Group. Founded in 2019, Aleph Alpha allows companies to develop and deploy large language and multimodal models. Its presence in Europe may help set it apart from other U.S.-based startups like OpenAI and Anthropic as more regulations are put into place around the world. Aleph Alpha did not announce a valuation with the new round.

7. (tied) SandboxAQ, $500M: Nearly a year after spinning off from tech giant Alphabet, AI and quantum computing startup SandboxAQ announced details of the funding in February, saying it had raised a $500 million round. SandboxAQ is examining the related effects of both AI and quantum — which is where the company gets “AQ” — to develop commercial products for telecom, financial services, health care, security and other computationally intensive sectors. One aspect of security the startup is looking at is how companies and the government can replace current public-key cryptography algorithms with algorithms that are resistant to quantum computer-based attacks. Investors named include Breyer Capital, former Google CEO Eric Schmidt, Thomas Tull, First Light Capital Group, funds and accounts advised by T. Rowe Price Associates, Guggenheim Investments, Time Ventures, Section 32, Parkway Venture Capital and others.

9. Mistral AI, $487M: Paris-based Mistral AI, another OpenAI and Anthropic competitor, raised a massive round of approximately $487 million near the end of the year at a $2 billion valuation, according to a Bloomberg report. Per the new report, the round included approximately $350 million in equity from investors led by Andreessen Horowitz — which was expected to invest more than $200 million. Other investors in the round include General Catalyst, Lightspeed Venture Partners and Bpifrance. In addition, both Nvidia and Salesforce agreed to contribute about $130 million in convertible debt to the deal. The raise comes just about six months after the startup — which is developing an open-source large language model — raised a seed round worth approximately $111 million led by Lightspeed Venture Partners.

10. Anthropic, $450M: Yep, one last time. Anthropic raised $450 million in Series C funding led by Spark Capital back in May. Like we said — it’s been very busy.

Those 10 rounds alone add up to more than $16 billion — that’s a lot of venture dollars in just 10 rounds no matter how you look at it.

Astute readers may also have noticed something else peculiar about the rounds other than just their size — who invested?

Microsoft led the biggest and co-led the second-biggest rounds. Nvidia co-led the second-largest round. Amazon the third. Google invested in the Anthropic round above (and one just off the list), while Nvidia participated in the Databricks round.

Coporates dominated much of AI investing, especially Nvidia which has hit it big with its much in-demand chips — becoming a $1 trillion-plus company this year. Aside from the companies on the list, the chip giant also took part in several big AI rounds for other startups such as Together AI and Enfabrica. It even has invested in a handful of biotech companies using AI.

While we often call it venture funding, many venture firms had to get in line behind Big Tech as they made their bankrolls felt. We could be in for more of the same next year.

FT : Veteran asset manager hits out at VW’s ‘flawed’ governance

Veteran asset manager hits out at VW’s ‘flawed’ governance

Bert Flossbach blames dominance of two controlling investors for share price underperformance at Europe’s largest carmaker

A veteran German asset manager has blamed Volkswagen’s “flawed” corporate governance for its share price underperformance and criticised its controlling shareholders for failing to address the issue.

“Ever since the diesel scandal, the flaws [in Volkswagen’s governance] have become clearly evident,” said Bert Flossbach, co-founder of Flossbach von Storch, which has €70bn of assets under management and is one of Germany’s most successful independent investment businesses.

The firm owns VW bonds but has not been an investor in its shares for years, Flossbach told the Financial Times in an interview. “We are aware of Volkswagen’s low [stock market] valuation but do not see any catalyst that could offset the discount to peers.”

Shares in VW have fallen more than 50 per cent over the past 18 months. Decision-making and controls at one of Europe’s largest industrial employers were “highly complex and tangled”, said Flossbach. This has weighed down on VW’s profit margins and share price, with investors concerned about the group’s transition to electric vehicles, its dependence on China for sales and profits and its governance.

Flossbach pointed out that Italian luxury sports-car maker Ferrari, which is more than 50 times smaller than Volkswagen by revenues, has a larger market capitalisation than VW. “This just beggars belief,” he said.

VW has a two-tier system of voting and non-voting stock, a significant governance problem according to Flossbach, because it gives disproportionate influence to the two dominant shareholders: the billionaire Porsche-Piëch family and the State of Lower Saxony. Between them, they control 73.3 per cent of the voting rights despite owning only 43.7 per cent of the equity.

“If the Porsche family announced tomorrow that it, jointly with the State of Lower Saxony, decided to convert all non-voting shares into voting stock . . . the share price would immediately sky rocket,” said Flossbach.

However, he added that the probability of this happening was “zero” because the Porsche-Piëch family was driven by “goals which are not of a financial character”. Control over the company appeared an end in itself for the family and they held on to their VW voting rights “like a petulant child in kindergarten clutching their toys”, according to Flossbach, adding that Lower Saxony’s goal was to have as many VW jobs as possible in its state.

He warned that the current governance meant that VW management was “basically handcuffed”, lacking the agency to make large cost cuts, move production overseas or break up a sprawling business that sells products ranging from motorcycles to ship engines.

VW, the Porsche-Piëch family and Porsche SE, which holds the family’s VW voting stock, declined to comment.

The State of Lower Saxony said that Flossbach’s criticism was “incorrect”, arguing that VW supervisory board members appointed by the state focused only on what was in the best interests of the company, as required by German law.

While VW sells about 12 per cent of its cars in Germany, 43 per cent of its workforce is employed in the country, where labour costs are significantly higher.

“As much as we like to see hundreds of thousands of Volkswagen jobs in Germany, this is probably unrealistic in the long term,” said Flossbach, adding that the company’s priorities were “a catastrophe for the firm in the long run”.

Cologne-based Flossbach von Storch was founded in 1998 by Flossbach and his former Goldman Sachs colleague Kurt von Storch.

FT :The challenge facing BT’s new boss

The challenge facing BT’s new boss

Allison Kirkby is tasked with executing a turnaround at the telecoms company to boost its languishing share price

Outgoing BT boss Philip Jansen set in motion radical cost cuts at the telecoms company. The pressure is now on his successor Allison Kirkby to execute a turnaround that investors are counting on to boost languishing returns.

Kirkby’s in-tray includes improving BT’s ailing business division, dealing with the potential merger of two rivals, and fending off competition from the challengers snapping at its heels as it races to roll out full-fibre broadband across the UK.

The Glaswegian, who spent most of the past decade turning around former state-owned telecoms monopolies in Scandinavia, faces the daunting task of trying to restore the FTSE 100 company’s share price, which has fallen around 45 per cent since Jansen took over in February 2019.

Chief among Kirkby’s tasks is improving the performance of BT’s business unit, created from a merger of its global and enterprise divisions last year with the aim of saving £100mn by 2025. Analysts say the division, which serves small and medium sized businesses and public sector customers badly needs to increase revenue.

Paolo Pescatore, founder and TMT analyst at PP Foresight, said Kirkby will “want to have a razor sharp focus on the execution” of that aim because otherwise “the writing is on the wall” for the unit, one of BT’s three main divisions.

In November, it posted a 11 per cent fall to £806mn in adjusted earnings before interest, taxes, depreciation and amortisation for the six months to September 30, compared with the previous year. Pescatore said BT appeared not to be exploiting its competitive advantage on its networks or cyber security capabilities.

That month BT Business’ chief executive Bas Burger acknowledged previous promises of growth had “not all materialised” and there were plans to “radically simplify” the business.

A European telecoms executive said the now combined divisions were “problem areas” that “need to be turned around”.

When she takes over next year, after four years as a BT non-executive director, Kirkby will be combating discontent on multiple fronts, including from Kintbury Capital, which is shorting the company.

In December the hedge fund’s chief executive Chris Dale told the Sohn conference “debt keeps rising and we’re basically in an unsustainable financial position”, adding the telecoms group’s “core profitability is under pressure”. Dale said Kirkby should cut the dividend and possibly accelerate its rollout of full fibre broadband.

Kirkby will also need to bring the company’s own staff onside, following a rocky period last year in which employees went on strike for the first time in more than 30 years.

John Ferrett, national secretary of Prospect union, said: “The last few years at BT have felt like a period of never-ending reorganisation and Prospect members would welcome a prolonged spell of relative stability.” Although a pay deal in September improved morale, he said impending cuts of up to 42 per cent of the company’s 130,000-strong workforce by the end of 2030 were a concern.

BT is undertaking a cost cutting programme that it said in November had delivered £2.5bn in annualised savings, and was on track to meet a £3bn target by its 2025 financial year.

Two of the biggest shareholders, billionaire Patrick Drahi’s Altice and Deutsche Telekom, are being closely watched too. Drahi is under pressure to sell assets at his heavily indebted telecoms company, while Tim Höttges, Deutsche Telekom’s boss, told the Financial Times earlier this year that buying a stake in BT was the “biggest mistake” he had ever made.

BT’s £15bn plan to roll out high-speed broadband to 25mn homes by 2026 is in better shape, described by HSBC analysts as the “key driver of value in the BT investment case”. The company is halfway to that goal and is planning to reach up to 30mn premises by the end of 2030, but competition from smaller rivals is intensifying.

Kester Mann, director of consumer and connectivity at CCS Insight, said it would be up to Kirkby to “continue that deployment and also to monetise it”, emphasising the need for customer uptake. Its take-up rate was a third in December.

Meanwhile, dozens of alternative network providers or “altnets” have sprung up, with BT warning earlier year that it could lose more of its broadband customers than expected this financial year. Jansen said BT was losing out to rivals who built full fibre to homes first in rural areas.

Mann added there was “lingering uncertainty” among investors about whether the investment in full fibre rollout would offer a return. He said it was “the biggest concern” shareholders have and the main reason why the share price had recently “struggled so much”.

BT said it was “confident that we can support our progressive dividend and that we will see a material uplift in our cash flow once our peak full fibre build is completed in December 2026”.

The company’s consumer unit EE could also face intense competition if a domestic merger between Vodafone and CK Hutchison-owned Three is approved. EE is the biggest source of revenue for the group, bringing in £4.9bn in the first half of this financial year. It plans to start selling kitchen appliances from next year and expand its other goods and services as part of a brand refresh and marketing push.

Pescatore said there would “need to be some results” from that move, adding BT could also face challenges in converting BT broadband households to EE. BT last year announced all consumer units would be moved under the EE brand.

With shares down about 50 per cent over the past five years, Justin Funnell, telecom analyst at Nextgen Research, said the company was “potentially vulnerable to a bid” as it was “at the deepest part of the fibre investment curve and the pension deficit [has been] brought down to manageable levels”. BT in November announced the funding shortfall in its retirement scheme had more than halved to £3.7bn, from £7.98bn three years ago.

As for Jansen, he told reporters in November he was looking forward to his “first” day off in 35 years once he steps down.

When asked about regrets, he said he was “disappointed . . . that the share price is where it is”. Ultimately, this is the metric that Kirkby is also likely to be judged on.