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Boring Co. Shares Rise Over 22% in Employee Share Sale

The sale priced shares at around $24 each, the two people said. That’s up from roughly $19 per employee share when Sequoia Capital and Vy Capital led the company’s $675 million Series C, announced in April 2022, which valued it at $5.675 billion. According to one of the people, The Boring Company told shareholders that investors could buy up to $20 million in secondary shares as part of the recent share sales, known as a tender offer.

THE TAKEAWAY

• The Boring Company shares were valued at over 22% more than last year

• Investors could buy up to $20 million in secondary shares in the tender offer

• The Boring Company projects haven’t gotten much traction outside Las Vegas

Tender offers typically allow existing shareholders to sell some of their holdings in a company, without raising new capital for the company. It’s not clear whether the company has issued more shares since the last funding round, which would affect its total valuation.

Representatives of The Boring Company didn’t respond to requests for comment.

The double-digit increase in The Boring Company’s valuation is impressive considering the company has yet demonstrated it has much of a business. Musk founded The Boring Company in 2016 with a goal of solving traffic by building tunnels faster and cheaper than can be accomplished with conventional equipment. The company has created a tunneling machine called Prufrock that it says is designed to bore a mile-long tunnel in a week.

But despite several high-profile negotiations for tunnel projects with cities in California and Florida, the only Boring Company project that has gotten any traction is in Las Vegas, where it dug a 1.7 mile tunnel under the Las Vegas Convention Center. That loop, which shuttles people between three stops using Tesla cars made by the Musk-led electric vehicle maker, opened in 2021.

The company, which is led by longtime Musk associate Steve Davis, has also announced plans to expand the Las Vegas loop to 29 miles and 51 stations.

Payment transfer group warns on profits and says changes in key currency markets have dented volumes

Shares in CAB Payments plunged as much as 74 per cent on Tuesday after the fintech warned on profits just months after a London listing that was hailed as a rare bright spot for the struggling UK market.

The company, which says it specialises in helping businesses make payments to “hard-to-reach markets” and has more than 490 customers, slashed its forecast for revenues this year by 17 per cent.

Changes to market conditions in African currencies, notably the Nigerian naira, the central African franc and the west African franc, have hit profit margins and volumes, said CAB. It added that its revenue projections for next year would be in peril if the picture failed to improve.

Analysts at Canaccord Genuity said it now “appears difficult to forecast future revenues with any degree of certainty”, helping to trigger the brutal sell-off.

Shares in CAB tumbled as much as 74 per cent to 55.6p, reducing the group’s market capitalisation to £160mn — down from the £851mn valuation it secured at its July flotation.

The warning from CAB comes six weeks after the group reported third-quarter revenues up 10 per cent. Canaccord analysts put the rapid deterioration since then to central banks tightening liquidity in the central African franc and making it harder for the likes of CAB to trade the west African franc.

CAB’s chief executive Bhairav Trivedi told the Financial Times that the intervention by central banks was “outside management’s control” and could not have been foreseen.

Coming a month after soda ash producer WE Soda pulled its proposed $7.5bn IPO, CAB’s listing was welcomed by a market that has been hit particularly hard by the global dearth of IPOs. Excluding those for blank-cheque vehicles, CAB’s IPO was London’s largest this year.

One banker said the collapse in CAB’s shares was “an absolute disaster” for a London market trying to sharpen its appeal to companies and wrestle more IPOs from New York.

Trivedi said he had no regrets over the London listing, adding that “it was the right thing to do”. He declined to comment on the share price and said he had not considered resigning.

Africa-focused private equity group Helios Investment Partners is CAB’s largest shareholder with a 45 per cent stake, down from 72 per cent before it sold shares in the IPO. According to Bloomberg data, Fidelity Management and Research and BlackRock are the second- and third-largest shareholders, with 7.5 per cent and 6.4 per cent stakes respectively.

Helios declined to comment.

Faced with a sharp deterioration in its business, CAB said on Tuesday it would implement “cost-reduction measures and efficiencies” to cushion the impact on profits.

Gautam Pillai, analyst at Peel Hunt, described the warning as “significant” and said it was putting its estimates and recommendation on the shares under review. The broker had previously rated the company a “buy” and had a target share price of 475p.

CAB said it expected revenue in 2023 to be “at least 20 per cent” ahead of 2022 levels, but that forecast was 17 per cent below its previous guidance. Trivedi insisted the company still had a “robust sales pipeline” but said the tough market conditions were “going to last weeks, some months and some might last a while longer”.

Move aimed at boosting City will abolish EU rule that limits payouts to twice base salary

The UK has said it will scrap a cap on bankers’ bonuses that was inherited from the EU as part of its post-Brexit push to boost the City of London.

The move follows a consultation this year on whether to abolish a 2014 rule limiting bonuses to twice base pay for employees of banks, building societies and investment firms.

The UK’s top financial regulators argued against the ban when it was introduced, and since leaving the EU the government has claimed its removal will increase the post-Brexit competitiveness of the City by making London a more attractive place for banks to base their staff. 

In a report on Tuesday, the Bank of England’s Prudential Regulation Authority, which carried out the consultation with the Financial Conduct Authority, said “a bonus cap is not routinely imposed in other leading international financial centres outside the EU”.

“The bonus cap has been identified as a factor in limiting labour mobility. The final policy . . . [removes] this barrier in the UK,” it said.

The changes would allow companies to reduce pay faster in economic downturns, making them safer from a financial stability perspective, the watchdog added.

In a separate statement, the FCA said the changes “should also help remove unintended consequences of the bonus cap”.

It cited “the growth in the proportion of the fixed component of total remuneration, which reduces a firm’s ability to adjust variable remuneration to absorb losses or for material poor performance or misconduct that subsequently comes to light”.

The new rules will take effect on October 31 and apply to this financial year and future ones.

Finance bosses privately gave a hesitant welcome to then chancellor Kwasi Kwarteng’s announcement last September that the UK would abolish the measure, fearing a public backlash. They originally opposed the bonus cap because it forced them to lift fixed pay to retain staff.

When the idea of scrapping the cap was mooted in June last year, Labour leader Sir Keir Starmer said the Conservatives’ plan amounted to “pay rises for bankers, pay cuts for district nurses”. But the opposition party has since embarked on a charm offensive to win the City over ahead of the general election expected next year.

Darren Jones MP, Labour’s shadow chief secretary to the Treasury, said: “Rishi Sunak is marking his anniversary of becoming prime minister by pushing ahead with Liz Truss’ plan to axe the cap on bankers’ bonuses. When Truss says jump, Sunak says how high.

“At a time when families are struggling with the cost of living and mortgages are rising, this decision tells you everything you need to know about the priorities of this out of touch Conservative government.”

HM Treasury said: “Decisions on remuneration in the banking sector are for the PRA as the independent statutory regulator.”

PRA chief executive Sam Woods said in September 2021 that the regulator had “never been a big fan of the bonus cap” since it reduced companies’ flexibility to cut costs during a downturn.

The change to the approach to implementation would also achieve the secondary PRA objective of facilitating effective competition as firms would be able to immediately apply the change, giving them more flexibility to share risk with employees.

But Paul Nowak, general secretary of the Trades Union Congress, the umbrella body for the UK labour movement, criticised the decision as “obscene”.

“At a time when millions up and down the country are struggling to make ends meet — this is an insult to working people,” he said, adding that the removal of the cap added to the case for “a national conversation about taxing wealth”.

The bonus cap was introduced in the EU to end the era of unlimited bonuses giving an incentive to finance workers to take huge risks, which was seen as a threat to financial stability in the wake of the 2008-09 financial crisis.

The UK has introduced other rules concerning pay to curb the threat to stability. These include requiring a percentage of bonuses to be paid out over a number of years, and allowing bonuses to be clawed back in cases of misconduct, poor individual performance and sometimes poor company performance.

After the removal of the bonus cap, UK regulators said they wanted firms to ensure fixed pay and bonuses were “appropriately balanced” and that no individual was “dependent exclusively on variable remuneration, or to an extent likely to encourage them to take risks outside the risk appetite of the firm”.

But Anne Sammon, partner at law firm Pinsent Masons, said there was a “risk associated with creating a two-tier workforce where new employees are paid lower salaries but with higher bonus potential”.

“Those who received increases to fixed pay when the bonus cap was introduced will be contractually entitled to those higher salaries and so will only give those up where they are offered some incentive to do so,” she added.

The San Antonio Spurs’ super-rookie debuts Wednesday night against the Dallas Mavericks, and he’ll be at his most captivating when he doesn’t have the ball

When Victor Wembanyama steps onto a basketball court, its geometry changes. Vincent Collet, Wembanyama’s coach with Metropolitans 92 during his final season in France, has witnessed the phenomenon. An opposing team can choreograph the perfect sequence of screens and passes, springing a shooter into open air with the rim in his sights. Then Wembanyama—7-foot-4, with the arms of an even taller man and the quick stride of a smaller one—enters the frame.

“You think you are alone,” Collet said in a recent interview. “And then, he’s back.”

Wednesday night in San Antonio, when his Spurs play the Dallas Mavericks, the most anticipated rookie since LeBron James will log his first regular-season minutes in the NBA. Fans around the world will tune in to glimpse dazzling feats of scoring. Will he debut his signature running, one-footed 3-pointer? If he misses it, will he stretch out and slam home his own put-back dunk?

But the 19-year-old Wembanyama’s premier talent—and the one likeliest to transform the league he’s about to join—isn’t making shots. It’s stopping them.

The NBA welcomes Wembanyama amid a period of peak offense, with increasingly precise shooters spreading to more and more distant sectors of the floor. According to Stats Perform, the four most efficient scoring campaigns in league history, on a per-possession basis, have come in the last four seasons, with a record of 114.1 points per 100 possessions set in 2022-23.

This isn’t, in league circles, an entirely happy development. Defensive-minded coaches fret over a version of the sport lacking balance, in which scorers have simply evolved past the capabilities of those tasked with checking them. If “space” is the watchword of the Stephen Curry era, players large and nimble enough to clog it are more needed than they’ve ever been.

“The movement demands required in today’s basketball are so different than what they were 20 years ago,” said Ben Taylor, a cognitive scientist who has spent a career studying the evolution of the game’s strategies. Back then, drivers bore down on the rim, and centers camped in the lane to barricade it. In the 2020s, big men have to sprint past the 3-point arc to dissuade snipers and back to the basket to break up alley-oop lobs, often making multiple round trips during a single loop of the shot clock.

The athlete capable of carrying out the updated job description is rare. Minnesota Timberwolves center Rudy Gobert, 7-foot-1, has averaged more than two blocks per game over a 10-year career, but speedy guards can get around him. The Golden State Warriors’ Draymond Green may be the most respected defender of his generation, a blur of anticipatory action, but he’s only 6-foot-6.

“It’s the combination of that physical attribute, the length, plus having mobility and awareness,” Taylor said. “What you want are possessions where you’re just like, ‘This guy’s everywhere! How is he doing this?’”

With Metropolitans 92, Collet encouraged his pupil to dictate instead of react. Wembanyama learned to bait traps for players charging at him, feinting one direction only to step in another. Teams commonly “funnel” a scorer to a second defender lying in wait; Wembanyama was so wide and well-schooled that he could funnel opponents to himself. His last season in France’s LNB Pro A, he blocked three shots per game, nearly double the average of the second-place finisher.

“He has fun denying whatever the ballhandler wants to do,” Collet said. “He likes the control.”

Wembanyama’s highlight reel from the Spurs’ preseason suggests the scope of that control. He unfurls a banner of an arm—his wingspan is a reported 8 feet—to flick away a 3-pointer. He reaches from a blind spot to swipe a steal and race the other way for a jam. In a three-second sequence spanning half the playing surface, he chases a shooter from the arc, tails him to the backboard and, with a palm almost as wide as a basketball, smothers a lay-up attempt. Over four preseason contests, Wembanyama averaged 4.7 blocks per 36 minutes—a rate that would have led the NBA last year.

“There’s nobody else in the league who can do some of the stuff that he can do,” said Spurs guard Devin Vassell. He wondered how Gregg Popovich, San Antonio’s Hall-of-Fame head coach, might deploy Wembanyama—as a roving presence, a back-line firewall, or both. “I don’t think he realizes how much he’s going to be able to help us out.”

The early stages of a basketball career consist of hype cycles and reality checks, and Wembanyama will inevitably struggle to match standards of pace and force. He’s skinny enough to present a ripe target to dunkers.

“They’ll welcome him to the league the right way,” Collet said with a laugh.

There is a more serious threat than embarrassment. Joining Wembanyama in this year’s rookie class is fellow beanpole Chet Holmgren, a 7-foot-1 former Gonzaga Bulldog who was selected second in the 2022 NBA draft. His first season was postponed by a Lisfranc injury to his foot, sustained after James—4 inches shorter than Holmgren but 55 pounds heavier—collided with him in a pro-am game. Wembanyama, who weighs 210 pounds, has adopted a regimen of strength training and stretching designed to keep his distinctive body intact; it remains to be seen whether such methods will hold up to the damage inflicted by Giannis Antetokounmpo.

Talk of Wembanyama’s fragility echoes the concerns that followed Curry during his early professional years. Observers worried that the guard was too slight to stand up to the rigors of an 82-game season, that he would get shoved out of anything more than a specialist’s role. In time, of course, Curry reoriented the sport, proving that a new-school mastery of angle and distance could outdo old-school muscle.

Wembanyama brings the potential for a similar shift—a catching-up to Curry’s offensive revolution, on its own terms. There is precedent for basketball’s defensive future in its history. Taylor cited Bill Russell’s book “Russell Rules,” in which the 11-time Celtics champion wrote of flummoxing rivals like Wilt Chamberlain using the “horizontal game.”

“I could run the floor, move laterally, block shots, put the ball on the floor, play defense as strongly away from the basket as I did near it,” Russell wrote. His mobility let him “determine where the ball was and where it was going.”

The difference, in Wembanyama’s case, is the shape of the body animating the ethos. Hustle and foresight alone cannot, as Wembanyama’s legs can, collapse the space between the sideline and the rim.

“He takes two steps and covers 25 feet, and you’re like, ‘Wait a second,’” Taylor said. “‘That actually doesn’t make human sense.’”

‘I went through hell,’ says 85-year-old Israeli hostage freed by Hamas

Yocheved Lifshitz was one of 200 people captured and taken to Gaza by Hamas militants in the October 7 attack

Beaten with a stick, thrown over a motorcycle like a sack and dragged into a subterranean network of tunnels inside Gaza, 85-year-old Yocheved Lifshitz spent 16 days as a Hamas hostage.

Released suddenly, alongside Nurit Cooper, 69, Lifshitz is one of four hostages — out of more than 200 taken into Gaza by Hamas militants in the October 7 attack — who have emerged, seemingly in good health, in a process mediated by Qatar, Egypt and the International Committee of the Red Cross. She is the first to speak publicly of her ordeal.

Hours after her release, she stood outside Ichilov Hospital in central Israel, and told her story, both surreal and sordid, to a bank of reporters.

“I went through a hell we never thought we could reach,” she said. “I went through a nightmare we couldn’t have imagined.”

At least 1,400 civilians and soldiers were killed in the devastating October 7 assault by Hamas militants based in Gaza, according to Israeli authorities, the worst attack in the history of the Jewish state. Israel responded by launching a massive aerial bombardment of Gaza, which has killed at least 5,087 people so far, local health authorities said, and levelled huge sections of the Palestinian enclave.

For Lifshitz, the scenes keep repeating in her head. She told of the Hamas fighters who broke in and rampaged through the Kibbutz Nir Oz where she lived, killing and kidnapping “old and young, with no distinction”. She and her husband, a peace activist, were snatched from their beds. He is still held hostage.

“When they took me, they put me on a motorcycle, legs on one side, head on the other,” she recalled.

Two motorcycles flanked the one she was on, and all three raced through the fields, just a few kilometres from Gaza’s border with Israel. “They didn’t break my ribs, but it hurt a lot, making it difficult to breathe,” the elderly woman said.

Someone robbed her of her watch and jewellery. She guessed they were briefly held in the southern Gaza town of Abasan Al-Kabira. After that, she has no idea.

Taken underground, her captors guided her for two or three hours through a “spider web of tunnels”, eventually emerging into a large hall with 25 other captives. They were separated again, with the hostages arranged by the kibbutz that they had been snatched from.

The situation improved after that. They were visited by a doctor every other day, who gave them medication they needed, swapping out similar ones for those not available in Gaza.

“They took good care of the wounded,” Lifshitz said, describing one person who had been injured in the arms and legs during their kidnapping. “It was heartbreaking to see that.”

Their captors took care of their hygiene, even cleaning their toilets. “They were worried about the outbreak of something,” she said.

They received a pitta bread with white cheese and cucumber each day.

In a video staged around their release and handover to a Red Cross representative, she and Nurit appear dazed, but unhurt. Clothed in the long dresses worn by older Palestinian women, they are offered biscuits and a drink from masked Hamas fighters, with the handover captured on camera by the militant group.

In a clip that has since gone viral on Arab television channels across the region, she then reaches back to shake the hand of one of her armed captors. Her description of the care her captors took of her have also been played nonstop on some Arab news channels, alongside her criticism of the Israeli government’s failure to protect her and her family.

“The lack of knowledge by the IDF [Israel Defense Forces] and Shin Bet [the intelligence service] harmed us badly,” said Lifshitz, adding that the military ignored signs from weeks ago, when Palestinian crowds massed at the fences.

“In the military, they did not take it seriously,” she said. “We were the scapegoat of the government.”

As strategics like Unilever and L’Oréal divest from once-core lines, a more selective approach to M&A is underway.

Earlier this month, L’Oréal quietly offloaded Sanoflore, the natural skin care brand it acquired in 2006, to private equity firm Ekkio Capital, and stopped the commercialisation of Decléor, the essential-oil-based skincare line it purchased from Shiseido in 2014. The divestitures, while significant, got a fraction of the attention that the French conglomerate received when it splurged for Aesop in April. Unilever, meanwhile, hired investment banks Morgan Stanley and Evercore Inc in September to sell off its non-core beauty portfolio that includes Caress, TIGI, St. Ives and Q-Tips.

As competition in beauty has become more fierce, larger companies like L’Oréal, Unilever and Kao are moving from generalists to specialists in a quest to cut costs and follow stricter divisional mandates. While conglomerates often have plenty of cash on the balance sheet, there is no doubt that financial pressure is mounting. (Following a projected fifth year of profit slump, Kao, the Japanese owner of Bioré and Curél, has committed 60 billion yen, or approximately $400 million, to structural reforms, with the cosmetics business at the forefront.) Internal hurdles like staffing and resourcing can make sustaining a scattergun portfolio approach hard; specialising enables these organisations to make bigger, better bets.

“Historically, the focus was just, ‘We are a beauty company’,” said Marko Horvat, a managing director at investment bank Raymond James. “Focus has become a recent theme. There’s now a view that specialisation lets [strategics] extract more value, rather than a portfolio that’s a little of this and a little of that.”

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