TheChek News Flow

HPE points to intensive AI applications using Juniper’s products to justify its acquisition

Twenty-five years on from the dotcom internet bubble, the tech sector is entering an artificial intelligence frenzy.

Juniper Networks has lived long enough to prosper from both. On Tuesday, Hewlett Packard Enterprise announced that it would acquire Juniper for $14bn, representing a juicy 32 per cent premium to the latter’s previous trading price. HPE hopes that Juniper’s switches and routers will fit nicely into its existing hardware and software offering for corporate computing systems. 

In particular, HPE points to data centres running intensive AI applications, which Juniper products can help to manage. HPE says the combination is worth $450mn of annual cost synergies, or nearly a tenth of Juniper’s revenue.

The all-cash buyout is transformative for HPE, whose enterprise value is $30bn. Its shareholders, however, are worried about the fit and new leverage. It shed $2bn in market cap when the news was announced.

For Juniper, this marks the conclusion of a wild ride as a public company. The takeout price represents an annualised appreciation from its 1999 initial public offering of about 8 per cent, excluding the small dividend it has paid in the past decade.

That index fund-like return belies the stock’s extreme moves, however. At its peak in 2000, market capitalisation reached $76bn. This was a year in which revenues hit $700mn. By 2002, the equity value had fallen to less than $2bn.

Juniper was among a group of telecom equipment manufacturers that were expected to be major winners of the internet buildout. Cisco Systems, the star of the lot, reached a market cap of $550bn. Today, a much more diversified Cisco is down to $200bn. Some companies, such as Alcatel-Lucent and Brocade, were eventually acquired. Others, like Nortel Networks and Global Crossing, went bust. 

Many of the rest, including the likes of Juniper, Ciena, Corning and JDS Uniphase, have continued to plug along in mostly obscurity as public companies with multibillion-dollar market caps. Juniper’s current operating profit margin of 17 per cent substantially exceeds that of HPE, itself a survivor of multiple tech cycles.   

Excitement around AI has boosted the likes of chipmaker Nvidia, which now trades at 22 times its 2024 expected revenue. OpenAI, which has barely been commercialised yet, is reported to have reached a private market valuation of $86bn.

Whether those figures are grounded in eventual profits remains to be seen. Juniper shows that even if the grandest expectations are not met, a useful business may exist underneath.

Study harnesses millennia-old human DNA to plot ‘genetic divide’ on origin and spread of health risks

Ancient migration patterns reveal why some Europeans are more at risk than others from a range of diseases including multiple sclerosis and Alzheimer’s, according to groundbreaking genomic research.

Millennia-old movements of hunter-gatherers, farmers and steppe pastoralists help explain the modern-day “genetic divide” in aspects such as height and susceptibility to diseases such as diabetes, say four papers published in Nature on Wednesday. 

The pan-continental study offers a surprising account of how some prominent public health scourges have evolved — and possible clues on how to manage these risks in the modern era. 

“This project has changed my view of both myself . . . and the history of Europe,” said Eske Willerslev, a professor at Copenhagen and Cambridge universities and one of the study’s authors. “What these papers are doing is setting the framework for how you use these ancient human genomes to understand the origin and spread of disease risk.”

Willerslev and colleagues sequenced genetic data from 317 radiocarbon-dated ancient skeletons and added this to existing information from 1,300 more specimens. The samples dated back as far as about 15,000 years and covered social transitions through the ages of hunter-gathering, farming and pastoralism. 

A crucial turning point was the arrival of neolithic farmers from the Middle East in western Europe about 11,000 years ago, the researchers discovered. This created a “genomic boundary” on the continent that ran from the Black Sea to the Baltic and lasted for thousands of years, with enduring consequences for public health and disease prevalence.  

“Archaeologists have been talking about this divide for a long time,” said Morten Erik Allentoft, professor in evolutionary genomics and biodiversity at Copenhagen university, who was involved in the research. “But witnessing this in genetic data is one of the really cool things about this [study].”   

The insights on multiple sclerosis came from comparing part of the ancient data with the genetic information of more than 410,000 present-day self-identified white Britons.

MS is a so-called autoimmune disease, in which the human body hurts itself through its defensive response to invading microbes, with damage to nerve cells in the brain and spinal cord that can cause serious disability. This disease, which affects more women than men, is most prevalent in Europe and in particular in the northern part.

Yamnaya pastoralists from the Pontic Steppe linking eastern Europe to central Asia brought genes associated with a heightened MS risk to Europe about 5,000 years ago, the researchers found. The Yamnaya’s higher concentration in northern Europe helps explain the greater prevalence of MS there.

The findings suggest a striking case of an ancient boon becoming a modern burden. The pastoralists’ genetic profile may have done them more good than harm, as it helped protect them against diseases carried by their herds.

“These variants were giving [ancient] people an advantage of some kind,” said William Barrie, co-author of the MS paper and a research associate at Cambridge university. “We think it was protecting them from their animals’ pathogens.”

Another strand of the research looked at how historical migration linked genetically to predisposition to various contemporary illnesses. Western hunter-gatherer ancestry — prominent in the Baltic states, Belarus, Poland and Russia — was more strongly linked to traits related to Alzheimer’s, high cholesterol levels, blood pressure and diabetes.

By contrast, neolithic farmer lineage, more prominent in southern Europe, was connected to a greater disposition to anxiety, guilty feelings and irritability. 

The scientists further found that Steppe antecedents appeared to play a part in why modern northern Europeans are taller on average than southern counterparts. This ancestry peaks in Ireland, Iceland, Norway and Sweden.

The study shows how “shifts in culture and lifestyle” of ancient human populations “have had long-term effects and are still affecting us today”, said Selina Brace, principal researcher in ancient DNA at the Natural History Museum.

“Anything that moves in the direction of a greater understanding of these diseases holds potential to help treat them,” said Brace, who was not part of the research.

The researchers’ discoveries about disease risks in white Europeans highlight the potential to apply the approach more widely both within and beyond the continent. 

The techniques should be used to deepen understanding of how vulnerability to illnesses has evolved in populations around the world, argued Samira Asgari, assistant professor at New York’s Icahn School of Medicine at Mount Sinai, and Lionel Pousaz, a science writer. 

“It is crucial to extend these studies to diverse human populations to better understand how differences in population history might have contributed to the risk of autoimmune diseases such as multiple sclerosis,” according to a commentary also published in Nature by the two authors, who were not involved in the European research.

“Although human biology is shared, each population has a unique history and focusing on a single population limits opportunities for discoveries that can bring insights that advance medicine.”