Glitz Paris : La liste de courses rêvée de Bernard Arnault

La liste de courses rêvée de Bernard Arnault
Déjà propriétaires de 75 marques, le fondateur et PDG de LVMH continue de convoiter quelques maisons indépendantes. Revue de détail des cibles idéales du magnat du luxe.

Depuis le rachat du joaillier Tiffany & Co, en janvier 2021, scellé par la réouverture du magasin new-yorkais de la marque le mois dernier, LVMH n'a plus mené aucune acquisition. Une éternité dans un groupe qui s'est principalement développé par rachat et dont la trésorerie florissante permettrait, en théorie, de s'emparer de quantité de cibles. Si la fièvre acheteuse de Bernard Arnault fait périodiquement l'objet de rumeurs - un projet de raid sur Cartier a été évoqué ces derniers mois -, LVMH guigne, plus discrètement, une poignée de petites maisons auréolées d'une histoire prestigieuse mais tenues par des familles qui souhaitent garder la main sur leurs enseignes.

Elargir l'offre maroquinerie
C'est le cas des Signoles, qui contrôlent depuis 1998 le malletier Goyard, une maison fondée en 1853 et qui, aux yeux du fondateur de LVMH, constituerait une addition bienvenue au pôle maroquinerie du groupe. Le géant du luxe a déjà tenté plusieurs ouvertures discrètes en direction de la société, installée à l'angle des rues Saint-Honoré et Castiglione, à Paris - en face du magasin Louis Vuitton de la Place Vendôme. Toutes se sont toutes heurtées à une fin de non-recevoir. Pire : depuis 2018, Goyard a mis en place un verrou actionnarial sur son capital en instituant des actions dites "de catégorie A", qui concentrent 90 % des droits de vote au conseil d'administration.

En cas de disparition du président du conseil d'administration Jean-Michel Signoles, l'homme d'affaires de 75 ans qui dirige Goyard avec ses trois fils depuis 1998, ses actions "de catégorie A" s'évanouiraient, empêchant toute revente à un potentiel repreneur de ces titres dotés de pouvoirs étendus.

Outre son histoire prestigieuse, Goyard a la particularité de maîtriser intégralement sa chaîne de production : sa filiale de fabrication, Algo, dispose d'un atelier dans la Drôme, près de Romans-sur-Isère, ancienne capitale française du cuir et de la chaussure, et a annoncé en 2022r la création de deux usines dans la périphérie de Carcassonne (Aude), d'où est originaire la famille Signoles. Une stratégie de contrôle de la chaîne de valeur qui est également celle du malletier Vuitton, fleuron de LVMH, qui a récemment racheté plusieurs de ses fournisseurs.

Etoffer la gamme du luxe masculin
A l'autre extrémité de la Place Vendôme, là encore vis-à-vis d'un magasin LVMH, celui du joaillier Bulgari, opère l'une des autres maisons qui intéressent de longue date LVMH : le chemisier Charvet. Comme Goyard, il s'agit d'une maison bientôt bicentenaire - elle a été fondée en 1838 - et qui contrôle intégralement la fabrication de ses pièces. La famille Colban, qui a racheté Charvet dans les années 1960, est l'ancien fournisseur textile du chemisier. Comme Goyard, le groupe ne connaît pas de difficulté financière majeure : ses derniers comptes disponibles, pour l'année 2019, font apparaître un chiffre d'affaires de près de 10 millions d'euros, pour un bénéfice net de 2,5 millions d'euros.

L'intérêt de LVMH pour Charvet coïncide avec la croissance exponentielle du prêt-à-porter haut de gamme masculin, dopé par la mode gender fluid ("genre flou").

Diversifier les grands Bordeaux
Déjà propriétaire de deux châteaux bordelais, Yquem et Cheval Blanc, Bernard Arnault rêve de longue date d'en ajouter un troisième à sa gamme de vins d'exception. Et non des moindres : le PDG de LVMH guigne Petrus, le plus prestigieux des Pomerol, l'une des appellations de la rive droite de la Dordogne. Petrus appartient depuis la fin des années 1960 au groupe Videlot, de la famille Moueix, qui contrôle également le groupe de distribution de vins de Bordeaux Duclot, ainsi que les hôtels K2 et la société de restauration Experimental.

L'entrée, en 2018, du millionnaire colombien Alejandro Santo Domingo, époux de la fille du 9e duc de Wellington Charles Wellesley, Charlotte Wellesley, au capital de Petrus comme actionnaire minoritaire (20 %), a fait grincer quelques dents au siège de LVMH.

Parier sur le temps long
Dernier rêve, inlassablement caressé mais constamment frustré : Patek Philippe, la société horlogère genevoise de la famille Stern. Malgré des approches répétées, la marque reste farouchement attachée à son indépendance. Seule consolation : en rachetant Tiffany & Co, LVMH a trouvé dans l'escarcelle un partenariat avec Patek Philippe, dont la chaîne de bijouterie distribue les articles aux Etats-Unis depuis plus d'un siècle et co-produit des éditions limitées.

Business Of Fashion : ‘Culture Is the New Luxury’: Golden Goose CEO Unveils Stra

‘Culture Is the New Luxury’: Golden Goose CEO Unveils Strategy for Next Chapter
After reaching €500 million in annual sales, Golden Goose is set to roll out a new cultural hub in Venice and leverage partnerships with creators including Suki Waterhouse and Brian Woo, joining players like Louis Vuitton and Moncler in putting culture, not just fashion, at the heart of its brand in a bid to widen its appeal.

KEY INSIGHTS
  • Golden Goose is launching a new Venice hub and line-up of cross-cultural events and collaborations, its CEO revealed.
  • The brand joins Moncler and Louis Vuitton, who have reached beyond fashion to expand their audiences and reposition themselves as cultural brokers.
  • The move suggests cultural strategies are becoming relevant for the fashion industry more broadly, beyond luxury mega-brands.

Golden Goose is set to become the latest luxury player to put culture at the heart of its brand strategy. Next week, the label known for its pre-distressed “Made in Italy” skate sneakers is set to inaugurate a sprawling new hub in Venice’s mainland industrial district of Marghera, which will include a school for craftsmanship and art, product development hub and space for exhibitions and events.

At a launch event May 22, the brand is also will roll out a new program of cross-cultural activations and collaborations: art installations and performances by singer and actress Suki Waterhouse, tattoo artist Brian Woo, activist Quannah Chasinghorse, architect Fabio Novembre and musician Sunmi will be revealed on the margins of the Venice Architecture Biennale, to be followed by special-edition co-signed products released throughout the year.

Golden Goose’s new push comes amid a broader shift in how luxury companies are activating their brands, reaching beyond fashion as they aim to expand their audiences and reposition themselves as wider “cultural” brands. This year, Moncler relaunched its “Genius” program of collaborations, swapping out niche designers for tie-ups with Mercedes-Benz, Alicia Keys and Pharrell Williams, who was also named menswear creative director at Louis Vuitton as part of a strategy to lean further into non-fashion activations.

“Culture is the new luxury,” chief executive officer Silvio Campara told BoF ahead of Golden Goose’s launch. The suite of activations across Venice (which will also include a Golden Goose-branded vaporetto between Marghera and the Biennale, activations at central venues like the Venice Venice Hotel, billboards and sponsored bike-share service) is designed to “help people discover art and discover what is Golden Goose.”

Campara is counting on a busy calendar of cultural events and collaborations to help fuel the Permira-owned brand’s next stage of growth after annual sales grew 30 percent to €501 million last year. Sales rose 20 percent in the first-quarter of 2023, the brand said Thursday.

Revamping its handbag offer — which is currently limited to a range of accessibly-priced camera bags — will likely be another growth opportunity for the coming seasons.

Cultural strategies have grown in importance in recent years for top luxury brands like Prada, whose sprawling art foundation in Milan and reputation for cutting-edge design (not to mention its mega-brand marketing budget) have given the label the credibility to forge partnerships with elite players in art, cinema and music. In 2021, Chanel started a book club and literary podcast (hosted by Monegasque royal Charlotte Casiraghi), while Louis Vuitton has pushed has pushed program of cross-cultural collabs to new heights with its Pharrell hire, star-studded tribute shows to Virgil Abloh, and a worldwide program of store installations and outdoor advertising to mark the latest chapter of its tie-up with Japanese sculptor Yayoi Kusama. Brands have also been ramping up their partnerships with sports, collaborating with Formula 1 teams and staging communications coups with top athletes.

Golden Goose is a different type and scale of brand, however: while the company has long flirted with a luxury positioning by celebrating its Venice roots and selling sneakers for €430 and up, it’s also largely steered away from presenting itself as exclusive or sophisticated. Its product assortment—which is focused on slight variations to its hero skate shoes—and brand platform marrying the manufacturing legacy of Venice, Italy with the skate scene of Venice Beach, California are both fabulously accessible and direct.

Does it make sense for a sneaker brand aimed at millennial and Gen-Z “paninari” in Italy and beyond to position itself as a broker of culture writ large?

The world does not need another fashion show.

According to Campara, it’s all in the execution, with Golden Goose planning to focus on creating creative activations that are approachable and relevant to local audiences, as much as they are prestigious. “It’s art for the people,” with creators who have clear values and aren’t afraid to be sentimental, Campara said. “All these people have something to tell you in a genuine way.”

Selections like LA-tattoo artist Briann “Dr.” Woo typify the strategy: he’s an established, reputable creative, but one whose audience nonetheless includes a strong contingent of spendthrift crypto-bros more interested in product-driven labels with tribal appeal like Rhude, Amiri (or perhaps now, Golden Goose) than in tracking the trends of fashion week runways.

In addition to reaching new communities, the move could also help animate Golden Goose’s product lines and communications for existing customers. While Golden Goose’s strength has long been its laser-sharp focus on promoting hero products, the luxury industry’s broader refocus in recent seasons on telegraphing brand heritage and celebrating iconic items has left some in the market wondering what comes next. The collabs could help Golden Goose make its narrative more textured and dynamic, while staying true to its hallmark simplicity and side-stepping strategies like fashion week outings, where efforts by brands without enough robust cred among the fashion cognoscenti often fizzle.

“The world does not need another fashion show,” Campara said. But a tie-up with Dr. Woo? “Brian is the King of L.A. — he can legitimise us in a community that would not have approached Golden Goose before.”

Following the Venice launch, the brand is planning further rounds of large-scale collaborations and events in Paris and Milan.

Its Paris event, slated for October, will celebrate Golden Goose’ ties to skateboarding culture as well as staging activations with various artists and “makers” in shoemaking, gastronomy and upcycling. The aim is to engage Golden Goose’s existing base, while also exposing the brand to a wider circle of tastemakers: that “small niche with the power to legitimise a brand,” Campara says.

WSJ : Hebrew Bible Sells for $38.1 Million, Second Most Expensive Document Sold

Hebrew Bible Sells for $38.1 Million, Second Most Expensive Document Sold at Auction
The Codex Sassoon, as it is known, is the second most expensive historical document ever auctioned

Sotheby’s sold a roughly 1,100-year-old Hebrew manuscript for $38.1 million on Wednesday, making it the second-most expensive historical document ever auctioned.

The 26-pound book, whose five-inch stack of parchment contains 396 pages, sold following a five-minute battle between two bidders vying mainly over the telephone. The final price, with Sotheby’s fees, fell short of breaking the record currently held by a $43.2 million copy of the U.S. Constitution bought by billionaire Ken Griffin two years ago.

The buyer was the American Friends of the ANU Museum of the Jewish People in Tel Aviv, who intend the work to be a gift to the museum, Sotheby’s said.

“We wanted it to come home,” said Irina Nevzlin, chair of the museum’s board of directors. Nevzlin said the museum aspired to own the codex after displaying it for a week in March, where it proved an immediate hit with the public.

“This is something that connects us all to our roots and gives us a foundation of who we are—for everybody in the world,” she said.

It topped the $30.8 million paid by Microsoft co-founder Bill Gates for a copy of Leonardo da Vinci’s scientific notebook known as the Codex Leicester. It also surpassed the $21.3 million paid by Carlyle Group co-founder David Rubenstein for a copy of the 1297 Magna Carta in 2007.

Sotheby’s estimated the Hebrew Bible would sell for between $30 million and $50 million, renaming it the Codex Sassoon in a nod to David Solomon Sassoon, a major Judaica and manuscript collector who bought the work in 1929 for £350, the house said.

After Mr. Sassoon died in 1942, his estate held on to the book until 1978, when it sold the work for around $320,000 to the British Rail Pension Fund. That fund resold the work in 1989 for $3.1 million to a collector who quickly flipped it to its current owner, Jaqui Safra, the billionaire descendant of the Lebanese-Swiss Safra banking family.

Mr. Safra paid researchers to conduct the carbon dating that definitively pegged the book’s origins to the late ninth century or early 10th century, the house said.

The book is said to be from the late ninth century or early 10th century. PHOTO: SOTHEBY’S
Heading into the sale, Sotheby’s said it had high hopes in part because Mr. Safra kept the work largely hidden away, adding to the book’s mysterious allure. The book’s singular place in bibliography also added to its appeal.

Although written long after the Dead Sea Scrolls, scholars consider this book to be the earliest and most complete collection of Hebrew writing gathered into a book instead of spread across a scroll. The book contains 24 smaller books that sweep across the Old Testament, better known to Jews as the Tanakh.

Richard Austin, Sotheby’s global head of books and manuscripts, said the tome is comparable to the Aleppo Codex but may be more historically significant simply because it’s more complete. The Aleppo Codex is missing some pages in part because it survived a synagogue fire in 1947.

Among collectors of rare and historic books, the value of a document often depends on what it says—with buying paying premiums for letters or first editions that divulge an author’s intimate thoughts or sentiments. This Hebrew Bible is comparatively straightforward, but its antiquity and completeness may have appealed to collectors of rare books.

That’s not to say it lacked a personal touch: Mr. Austin said its margins remain peppered with entries noting various past owners, from its sale by a man named Khalaf ben Abraham in the early 11th century to its 13th-century dedication to a synagogue in a town called Makisin in northeastern Syria—later allegedly destroyed by the Timurid Empire founder Tamerlane in 1400.

WSJ : Deutsche Bank to Pay $75 Million to Settle Jeffrey Epstein Accusers’ Suit

Deutsche Bank to Pay $75 Million to Settle Jeffrey Epstein Accusers’ Suit
A civil complaint alleged the financial institution facilitated the disgraced financier’s sex-trafficking ring

Deutsche Bank has agreed to pay $75 million to settle a proposed class-action lawsuit charging that the financial institution facilitated Jeffrey Epstein’s sex-trafficking ring, said lawyers who sued the bank on behalf of alleged victims.

A woman who is listed anonymously as Jane Doe in court papers filed the suit last year in New York on behalf of herself and other accusers of the disgraced financier. She alleged Deutsche Bank did business with Epstein for five years while knowing that he was using money in his bank accounts to further his sex-trafficking activity.

The Doe plaintiff alleged she was sexually abused by Epstein and trafficked to his friends from about 2003 until about 2018 and was also paid in cash for sex acts. The lawsuit alleged Deutsche Bank ignored red flags including payments to numerous young women. The settlement is expected to compensate dozens of accusers.

Epstein died by suicide in a federal jail in New York in 2019 while awaiting trial on sex-trafficking charges.

Dylan Riddle, a spokesman for Deutsche Bank, declined to comment on the settlement but said the bank has invested more than 4 billion euros, the equivalent of $4.34 billion, to bolster controls, training and operational processes, and has increased the size of its workforce dedicated to fighting financial crime. “In recent years Deutsche Bank has made considerable progress in remedying a number of past issues,” he said.

The bank didn’t admit wrongdoing as part of the settlement, according to people familiar with the matter.

The plaintiffs’ lawyers, from the law firms Boies Schiller Flexner and Edwards Pottinger, said on Wednesday they believed the $75 million was the largest sex-trafficking settlement involving a banking institution.

“This groundbreaking settlement is the culmination of two law firms conducting more than a decade-long investigation to hold one of Epstein’s financial banking partners responsible for the role it played in facilitating his trafficking organization,” they said in a joint statement.

The Deutsche Bank complaint was one of two lawsuits that took aim at banks for allegedly enabling Epstein to recruit and groom hundreds of underage girls and young women for sex with himself and his associates. The suits were filed last Thanksgiving, when New York state opened a yearlong window during which people who say they were sexually assaulted could file lawsuits, no matter when the conduct occurred.

The other lawsuit, filed by the same law firms, is against JPMorgan Chase. The U.S. Virgin Islands also sued JPMorgan late last year, saying the bank facilitated Epstein’s alleged sex trafficking and abuse by allowing the late financier to remain a client and helping him send money to his victims. Both suits against JPMorgan are ongoing, and Jamie Dimon, the bank’s chief executive, is scheduled to be deposed in the cases later this month, according to people familiar with the matter.

JPMorgan declined to comment on the Deutsche Bank settlement. “In hindsight, any association with Epstein was a mistake and we regret it, but we do not believe we violated any laws,” a JPMorgan spokeswoman has said. “We are committed to combating human trafficking and we will continue to look for ways to invest in advancing this important mission.”

The Deutsche Bank settlement came after the bank didn’t oppose the plaintiff’s request to certify the lawsuit as a class action. The agreement still needs to be approved by a federal judge.

Epstein started to bank with JPMorgan around 1998 and turned to Deutsche Bank after JPMorgan closed his accounts in 2013. Both banks worked with Epstein for years after he pleaded guilty in a Florida state court in 2008 to soliciting prostitution from a minor.

New York state’s financial regulator fined Deutsche Bank $150 million in 2020 for failing to properly monitor its dealings with the convicted sex offender and other lapses. Deutsche Bank said at the time that it was a mistake to take Epstein as a client and acknowledged weaknesses in its processes, and that it had learned from its mistakes.

The regulator found Epstein, his related entities and associates had more than 40 accounts at Deutsche Bank.

Under the terms of the settlement, dozens of eligible accusers will each automatically receive $75,000, according to people familiar with the matter. Accusers can potentially receive a larger award if they choose to make claims against Deutsche to an administrator of the $75 million settlement, the people said. The claims could result in an accuser getting a payment of upward of $5 million, the people said.

Epstein’s accusers have pushed for decades to hold him and his associates accountable. In 2022, Prince Andrew settled a federal sex-abuse lawsuit filed by Virginia Giuffre, one of Epstein’s most prominent accusers, agreeing to make a substantial donation to her charity. Giuffre accused Epstein and his socialite friend Ghislaine Maxwell of forcing her to have sex with the British royal when she was a teenager in the 2000s.

Maxwell was convicted of sex-trafficking in 2021 for recruiting and grooming underage girls and young women for sex acts with Epstein at his Florida estate, New York mansion and his compound in the U.S. Virgin Islands. She is serving a 20-year prison sentence.

WSJ : The Health Tests You Need at Age 30, 40 and 50

The Health Tests You Need at Age 30, 40 and 50
It’s hard to keep track of when to start getting screened for health issues. Here’s a guide.

Keeping track of when to start screening for health issues from cancer to cholesterol can be confusing—not least because guidelines for some of the biggest tests have changed in recent years.

Earlier this month, a government-backed panel of experts lowered the age at which they recommend women start getting mammograms to 40, down from the prior recommendation of 50. And many 40-somethings don’t realize they are now supposed to start getting colorectal cancer screenings at 45, even though that same expert panel lowered its recommendation from age 50 two years ago.

Most general recommendations are for healthy people of average risk. If you are at higher risk for developing a condition because of a family history or other factors, your doctor might recommend starting screenings sooner.

Start with your primary care provider, who should be able to tell you what tests you need and when. Most insurance plans cover most of the cost of a physical or wellness exam.

Strong recommendations from the U.S. Preventive Services Task Force—which is the independent panel of experts that issues recommendations on preventive services—must be covered by most private insurance companies and are often also paid for by federal insurers. Recommendations from other medical groups can differ, and might or might not be covered by your insurer.

“The most important thing is to have a relationship with a doctor that you’re seeing with some regularity,” says Dr. Matthew Bonzelet, an internist at Washington University in St. Louis.

Here’s a decade-by-decade guide to when to start many of the major screenings.

In your 20s
Many screening recommendations start in midlife, but there are plenty that begin in your 20s.

The average adult should get tested at least once in his or her 20s for sexually transmitted diseases such as gonorrhea, chlamydia and HIV, says Dr. A. Mark Fendrick, a general internist and professor of medicine and public health at the University of Michigan. You might want to test more often based on your risk factors, he says.

People in their 20s can also get tested for hepatitis C; the U.S. task force recommends that adults get tested for the hepatitis C virus once in their lifetime.

Screenings for cervical cancer in women of average risk are recommended starting at age 21 through age 65. The frequency of tests depends on what kind you’re doing. The task force and other groups recommend doing a cervical cytology test—often referred to as a Pap smear—every three years from ages 21 to 29.

In your 30s
For women 30 to 65 years old, the task force recommends continuing with a Pap smear every three years or getting an HPV test along with a Pap smear every five years. HPVs, or human papillomaviruses, cause many cervical and other cancers.

Start thinking about getting screened for diabetes and cholesterol. The task force recommends screening for prediabetes and Type 2 diabetes starting at age 35 for people who are overweight or have obesity. But the American Diabetes Association recommends that all adults over 35 get tested for Type 2 diabetes, and that people with higher risk factors get the blood test earlier.

Average-risk men should get their cholesterol levels checked at age 35 and women at age 40 to see if they need to take a statin, a cholesterol-lowering medication, according to the task force. Doctors say most people get checked earlier.

Dr. Jay-Sheree Allen, a senior associate consultant in family medicine at Mayo Clinic in Rochester, Minn., says she looks at a patient’s body-mass index, family history of heart disease, personal health history and lifestyle to determine when blood sugar and cholesterol screenings should be started.

“If I have a 25-year-old patient with a BMI of 40 and they’re telling me they have a family history of diabetes and cardiovascular disease, I’m screening them,” says Allen.

In your 40s
Women should start getting mammograms for breast cancer every two years at age 40, according to new task force draft guidelines. The American Cancer Society recommends that women get screened annually between 45 and 54 and every other year following that, while other groups recommend annual screening starting at age 40.

At 45, it’s time to get a colorectal cancer screening, which can be done through a colonoscopy or a mail-in stool test.

If you don’t have glasses or contacts and don’t regularly see an eye doctor, the American Academy of Ophthalmology recommends seeing an ophthalmologist to get a baseline for eye-disease screening when you’re 40. Go sooner if you have diabetes, high blood pressure, or a family history of eye disease. Such screenings can catch such diseases as glaucoma and cataracts.

In your 50s
Women who are postmenopausal should get screened for osteoporosis if their healthcare provider determines they have a high risk for fractures, according to task force guidelines.

Lung cancer screenings are recommended for adults 50 to 80 years old who have a 20-pack-year smoking history and currently smoke, or who quit within the past 15 years. A 20-pack-year history is equivalent to smoking a pack a day for 20 years or the equivalent, such as two packs a day for 10 years.

The guidelines for screening men for prostate cancer are all over the map, doctors say, and there is no universally accepted recommendation. The American Cancer Society recommends that starting at age 50 men talk to a healthcare provider about the pros and cons of testing. They recommend that men with a father or brother who had prostate cancer before age 65 or who are African-American have that conversation starting at age 45.

In your 60s
Women age 65 and older should get screened for osteoporosis with bone density testing to help prevent fractures, according to task-force recommendations.

Men who smoke or previously smoked should get a one-time screening for abdominal aortic aneurysm between the ages of 65 and 75 years old, per task force recommendations. Men without a history of smoking can talk to their health professionals about whether they should get screened.

Some doctors start cognitive testing in your 60s. At the Cleveland Clinic, doctors do a minicognitive test for patients 65 and older every year or every other year, says Dr. Neha Vyas, a family-medicine doctor at the clinic.

WSJ : Fashion Giant Shein Raises $2 Billion but Lowers Valuation by a Third

Fashion Giant Shein Raises $2 Billion but Lowers Valuation by a Third
Online retailer faces geopolitical headwinds and rising competition

HONG KONG—Shein, the online fashion company that won over millions of American shoppers during the pandemic, raised $2 billion in its latest fundraising round that values the company at $66 billion, about a third less than a year earlier, according to people close to the company.

The online-only retailer, which was founded in China and is now based in Singapore, cut its valuation after tech-company share prices have come down. The company also faces intensifying pressure from U.S. lawmakers on its labor and environmental practices.

Shein generated $23 billion in revenue last year, the people said, closing in on European rivals H&M Hennes & Mauritz and Zara owner Inditex, and its net profit was $800 million. Shein has set a target to grow its revenue by 40% this year, the people said.

Before the latest fundraising which closed last week, Shein was last valued at $100 billion a year ago, catapulting its worth to be more than the combined market capitalization of H&M and Inditex. At the time, tech companies were flush with cash and investors have been betting on cashing in eventually when Shein goes public.

The shares of technology companies have come under heavy selling pressure amid a slowdown in the sector that has led to layoffs, canceled projects and a new focus on cost-cutting. Some of these stocks have started to bounce back this year as investors have shifted focus to the U.S. banking turmoil, but tech-company valuations are still well below their levels at the start of 2022.

The latest round was co-led by Sequoia Capital, General Atlantic and the U.A.E. sovereign-wealth fund Mubadala. Both Sequoia and General Atlantic invested in previous funding rounds. Investors in the last round were allotted more shares in the company to maintain the size of their stakes, the people added.

Some existing investors told The Wall Street Journal that the lower valuation leaves headroom for the company to boost its market value should an IPO come to fruition. Such a stock sale would face challenges as scrutiny of the company intensifies.

Storm clouds have also been gathering in recent months as businesses with Chinese ownership are facing push back in the U.S. as geopolitical tensions between Washington and Beijing escalate. Shein, along with its latest rival Temu, owned by Chinese e-commerce company PDD, has been the target of a drumbeat of criticisms from U.S. lawmakers. And the Biden administration is demanding that TikTok’s Chinese owners sell their stakes in the video-sharing app or face a possible U.S. ban of the app on security concerns.

Earlier this month, the House China Committee sent letters to Shein and Temu, as well as Nike and Adidas, asking whether their products comply with the Uyghur Forced Labor Prevention Act, which bans cotton from China’s Xinjiang Region in the U.S. market. Separately, a bipartisan letter signed by more than 20 lawmakers to the Securities and Exchange Commission asked the regulator to order a supply-chain audit before Shein is allowed an IPO on American stock exchanges.

Shein said that it has no suppliers in Xinjiang and that its suppliers must adhere to a strict code of conduct aligned with the International Labor Organization’s core conventions.

“We have zero tolerance for forced labor,” the company said. Shein declined to comment on its IPO plans.

The company said on its website that its manufacturers are only allowed to source cotton from the U.S., India, Brazil, Australia and other approved regions, such as Bangladesh, Tanzania and Pakistan, adding that cotton from the U.S., India, Brazil and Australia make up about 95% of all cotton sourced for Shein-branded products.

uring the fundraising, Shein hired London-based consulting firm ERM to conduct an independent review and due diligence of its environmental, social and governance performance to address investor concerns, according to people familiar with the matter.

“Every single disrupter that has changed an industry has been faced with this type of backlash,” Marcelo Claure, Shein’s Latin America chairman, said. Such lobbying is expected “when you are changing many billions and billions of dollars that went to traditional retail,” he said.

Claure is a former SoftBank Group executive who joined Shein in January while also investing $100 million in the company from his family office.

Shein had a meteoric rise during the Covid-19 pandemic with its seemingly endless array of cheap, trendy clothes made mostly in Chinese factories and sold through an easy-to-use mobile app, with no bricks-and-mortar stores. It sells overseas, but not in China.

Founded in 2008 in the eastern Chinese city of Nanjing, Shein’s clothes—from $20 cocktail dresses to $5 T-shirts—have won the hearts of many young consumers in the U.S., Europe and other markets.

The company has said it can make its apparel at affordable prices because it uses algorithms to predict customer demand, produces in small quantities, and therefore is able to sell most of what it has made. Shein’s “on-demand production model” helps it reduce inventory turnover to about 40 days, less than half the time at bricks-and-mortar retailers such as H&M and Inditex, with fewer markdowns and less waste, according to a recent report by Boston Consulting Group on fashion-industry supply chains.

The company said last month it was investing $70 million over the course of the next five years to help its manufacturers upgrade their facilities and their workers’ conditions.

Shein is diversifying its supply chain to countries including Brazil and Turkey. It has said it is investing $150 million to train 2,000 local manufacturers in Brazil in the next three years, making the country an export hub for Latin America.

In response to criticisms that the company’s cheap, less durable clothing has fueled overconsumption, Shein launched a recycling program, “Shein Exchange,” last year in the U.S. The program has 1 million registered users. By comparison, it has more than 20 million monthly active users in the U.S., according to data from market-insights firm Sensor Tower.

Shein is facing challenges from Temu, which caught attention with its Super Bowl ads in February. Temu, launched in the U.S. in September, overtook Shein in November by mobile-app downloads just two months later, and recently topped Shein’s monthly active user numbers in the country, Sensor Tower data shows.

FT : Germany’s Green star brought down to earth by cronyism and boilers

Germany’s Green star brought down to earth by cronyism and boilers
Vice-chancellor Robert Habeck’s unpopularity is in stark contrast with the adulation he enjoyed for many years

Cronyism, boiler bans, botched gas levies — after a whirlwind rise through the ranks of German politics, Robert Habeck is now suffering one of its most precipitous falls.

The Green economy minister and vice-chancellor faced the darkest day in his 17 months in office on Wednesday when he was forced to sack one of his closest aides over a widening nepotism scandal.

The firing of Patrick Graichen, secretary of state at the economy ministry, came with Habeck already on the ropes over an unpopular law to ban new oil and gas heating systems from 2024. Consumer groups have criticised the deadline as too tight compared to countries such as the UK and the Netherlands and worry about the financial burden it imposes on homeowners.

“Herr Habeck is a man of beautiful words, but people are beginning to see through that,” said Julia Klöckner, economy spokeswoman for the opposition Christian Democrats (CDU). “At the end of the day he’s also a minister who has to show leadership.”

The Graichen affair, coupled with the boiler law, have taken the shine off a Green politician who was long viewed as a potential chancellor. In a matter of months he has gone from being Germany’s most popular minister to its most embattled. One poll released this month by Deutschlandtrend said only 30 per cent of voters were satisfied with the job he’s doing.

Manfred Güllner, head of the pollster Forsa, said he doubted Habeck could recover from his latest setbacks. “When you fall so far in the polls, and you’re still heading downwards, it’s very hard to rise up again,” he said.

Meanwhile, evidence is building that Habeck’s travails are also hurting his party. In weekend elections in the city state of Bremen, the Greens saw their share of the vote sink to 12 per cent — the lowest level since 1999.

Friedrich Merz, the CDU leader, said the Greens’ poor showing in Bremen was down to the “Habeck effect”. “I can only urgently advise the coalition not to enact climate policy with a crowbar,” he said. “It’s not working.”

National polling data is also not looking good for the Greens. A poll by Forsa on Wednesday put the party on 15 per cent — one point behind the far-right Alternative for Germany.

Senior Greens are unfazed. “Habeck has said you can’t do politics on the basis of approval ratings, and I agree with him,” said Konstantin von Notz, a prominent Green MP. “He knows that when you’re trying to fight the climate crisis by changing heating systems, you sometimes have to do things that won’t exactly win people’s hearts at once.”

The decline in Habeck’s popularity stands in stark contrast with the adulation he enjoyed for many years. When he and Annalena Baerbock were elected co-heads of the Green party in 2018, the former children’s book author was widely admired for his modern style of leadership, oratorical skills and ideological pragmatism — a characteristic not normally associated with the Greens.

In 2021 the two led his party to their best national result ever when they garnered 14.8 per cent in the Bundestag election. Soon after, he and Baerbock led the Greens into a unique three-way coalition with Olaf Scholz’s Social Democrats and the liberals.

Just months into office, Habeck had to deal with the energy crisis caused by Russia’s invasion of Ukraine and its subsequent suspension of gas supplies to Europe. Habeck and Graichen were widely credited with ensuring Germany did not run out of gas, avoided blackouts and dodged an economic crisis.

But there were plenty of slips on the way. Habeck was lambasted for his plan to impose a gas levy on all fuel consumers, a measure designed to help gas importers such as Uniper that had been driven to ruin by Moscow’s gas shut-off. After an outcry he pulled the plug on it.

The gas levy triggered doubts about Habeck’s economic competence, said Uwe Jun, a political scientist at the University of Trier, while the Graichen affair “has called into question his leadership qualities”.

One of the architects of Germany’s planned transition to a carbon neutral economy, Graichen came under attack last month over his role in the selection process for the new head of Dena, the German energy agency. He had failed to disclose that Michael Schäfer, who was chosen for the job in March, was a close friend and best man at his wedding.

Habeck defended Graichen publicly, saying he had acknowledged his mistake. But worse was to come: on Wednesday the minister revealed that Graichen had approved an application for funding from a Berlin environmental organisation where his sister worked. Habeck said that was “one mistake too many”.

The affair has reflected badly on the Greens, said Klöckner. “They’re shocked that they’re now perceived as a normal party, like any other,” she said. “They’re saints no more.”

But Von Notz dismissed the idea that Habeck had been damaged by the Graichen affair. “If you look at how other parties have dealt with issues like this in the past — they barely draw any consequences at all,” he said.

The Graichen scandal might be quickly forgotten, but not so Habeck’s boiler law, a measure that has triggered alarm in large swaths of the population and turned the minister into a hate figure for some homeowners.

“A lot of people were puzzled that Habeck, the great communicator, seemed unable to properly explain what he was trying to do,” said Jun. “The result of all this is that the public has become pretty disenchanted with him, and relatively fast.”

>>> US After Hours Summary: CSCO -4.2% and BOOT -15.5% lower on earnings; TTWO +8.5%, DLO +8% higher on earnings

After Hours Summary: CSCO -4.2% and BOOT -15.5% lower on earnings; TTWO +8.5%, DLO +8% higher on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: TTWO +8.5%, DLO +8%, SNPS +1.7%, BOWL +1%, CPRT +0.1%, SQM +0.1%

Companies trading higher in after hours in reaction to news: SNOW +2.4% (in talks to buy search startup Neeva, according to The Information), CABA +1.4% (stock offering), JNPR +0.5% (in sympathy with CSCO earnings), CB +0.4% (increases dividend), SAP +0.3% (KD expands strategic partnership with SAP), HOOD +0.1% (reports operating data for April)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: BOOT -15.5%, VSAT -4.6%, CSCO -4.2%, STNE -1.4%

Companies trading lower in after hours in reaction to news: NSTG -6.6% (TXG wins injunction in patent litigation with NSTG), APLD -5.7% (files $175 mln mixed shelf securities offering), PIII -2.7% (stock offering by holders), GFL -2.5% (holders to offer for sale 14,084,507 subordinate voting shares), TXG -2% (TXG wins injunction in patent litigation with NSTG), MNMD -1.9% (announces enrollment milestone in Phase 2b trial of MM-120), CI -1.7% (FTC seeking info from CVS and CI as part of probe into PBMs, according to Reuters), SGHC -1.5% (files $450 mln mixed shelf securities offering), LITE -1.1% (in sympathy with CSCO earnings), AVGO -1.1% (in sympathy with CSCO earnings), CNP -0.5% (files mixed shelf securities offering), KD -0.2% (KD expands strategic partnership with SAP), EXTR -0.1% (in sympathy with CSCO earnings)

The Information : Snowflake in Talks to Buy Search Startup Neeva in AI Push

Snowflake in Talks to Buy Search Startup Neeva in AI Push

Database software provider Snowflake has been in advanced talks to acquire Neeva, a search startup founded by former top Google ad tech executive Sridhar Ramaswamy, according to a person with direct knowledge of the discussions. Buying Neeva could help Snowflake offer artificial intelligence software that helps companies search for information in internal documents and data, according to people who do business with Snowflake.

Neeva primarily sells an ad-free web-search app for consumers, but it developed software that combines search with large-language models, which are trained on text to understand the nuances of speech and writing. That could fit with Snowflake’s efforts to help cloud customers use the kind of AI popularized by chatbots like ChatGPT that respond to conversational commands and can automate some business tasks. Snowflake is trying to catch up to rivals such as Microsoft’s Azure and Google Cloud that already sell access to such AI software.

THE TAKEAWAY
• Snowflake aims to raise profile in AI
• Deal illustrates emergence of new kind of database
• Neeva’s search service has struggled
The deal shows how the emergence of ChatGPT is shaking up the enterprise software market, prompting companies such as Snowflake to rethink their growth strategy.

Terms of the deal couldn’t be learned. Neeva’s private pre-money valuation was around $250 million at the time of its last announced funding round in 2021. Neeva, which has dozens of employees, including other ex-Googlers, also has shopped itself to Databricks, a rival to Snowflake, according to a person with direct knowledge of the talks and a second person briefed on them.

Neeva was founded in 2019 and raised nearly $80 million from Greylock Partners, Sequoia Capital and other investors to take on the difficult task of competing with Google. Neeva’s subscription search service doesn’t appear to have gained a lot of traction, but in January the company received attention for incorporating its own large-language models to give humanlike answers to queries. Behind the scenes, Neeva also developed what’s called a vector retrieval system and database, a way to store and organize data the LLMs use to deliver answers to search queries.

Snowflake’s main product is a type of cloud database for corporate data, but the company is angling to be a one-stop shop for businesses that use machine-learning models, according to one of the people who do business with Snowflake. In January the company acquired Myst, which sold software for developing machine-learning models to predict future events based on historical data. Snowflake may also benefit from the sudden proliferation of free, open-source LLMs could bring down costs and make it easier for businesses to use the technology.

Snowflake faces fierce competition in selling cloud-based AI services, but it could lean on its reputation as a secure service for businesses to store sensitive data. Snowflake’s service utilizes cloud servers from Amazon Web Services and other major cloud providers but Snowflake developed its own software that manages users’ access to data as an added security measure.

That could make Snowflake appealing to companies, some of which are concerned around leaking data to OpenAI and other developers of large-language models. Those models are trained on vast amounts of text scraped from the internet as well as information users feed into the chatbots when they converse with them.

Snowflake, which has a market capitalization of $55 billion, wants to ensure that customer data stays private and doesn’t end up in the training set, just as Microsoft has done with a cloud service that gives customers access to machine-learning models developed by ChatGPT creator OpenAI, the person said. Microsoft is also preparing to sell access to a version of ChatGPT to businesses worried about data leakage, The Information recently reported.

>>> US Close Dow +1,24% S&P +1,19% Basdaq +1,28% Russell +2,21%

Closing Stock Market Summary

The stock market exhibited some softness right out of the gate, but quickly found upside momentum. Gains built up throughout the session, aided by some short-covering activity. The major indices all closed near their best levels of the day, which had the S&P 500 back above the 4,150 level. 

Gains were driven by some positive responses to earnings and other corporate news, along with an emerging hope that the president and congressional leaders are more aligned with debt ceiling negotiations. Still, no deal has been reached and uncertainty remains in play for market participants. That uncertainty, though, was not enough to offset today's relatively strong showing, which had a pro-cyclical bias.

An uptick in single-family starts and single-family building permits in April, along with the Atlanta Fed's GDPNow model estimate for real GDP growth in the second quarter increasing to 2.9% from 2.6%, helped drive the cyclical trade.

Advancing issues led declining issues by a greater than 3-to-1 margin at the NYSE and a 5-to-2 margin at the Nasdaq.

Many stocks came along for the rally, leading nine of the 11 S&P 500 sectors to close with a gain. The financials sector sat atop the leaderboard, up 2.1%. This came after Western Alliance (WAL 34.81, +3.22, +10.2%) said its deposits have increased by more than $2 billion since the end of the first quarter. This news put a bid in the bank stocks, which was aided by short-covering activity. The SPDR S&P Regional Bank ETF (KRE) jumped 7.4%. 

The energy sector (+2.1%) was another winning standout today, rising alongside oil prices. WTI crude oil futures rose 3.0% to $72.81/bbl. The industrial sector (+1.7%) also outperformed in today's trade.

Several consumer discretionary sector (+2.0%) components with news catalysts logged nice gains and drove the sector's outperformance. Wynn Resorts (WYNN 108.92, +5.87, +5.7%) was a standout in that regard after being upgraded to Overweight from Equal Weight at Barclays; Tesla (TSLA 173.86, +7.34, +4.4%) was in rally mode after CEO Elon Musk teased "two new products" at Tuesday's shareholder meeting; and TJX (TJX 78.95, +0.73, +0.9%) lagged the S&P 500 (+1.2%), but still squeezed out a gain after its earnings report.

Meanwhile, the consumer staples sector (-0.1%) closed near the bottom of the pack despite a nice earnings-related gain in Target (TGT 160.96, +4.05, +2.6%). This comes ahead of Walmart's (WMT 149.53, -0.25, -0.2%) earnings report before the open on Thursday. 

Treasuries settled with losses across the curve, but shorter tenors saw greater selling interest. The 2-yr note yield rose nine basis points to 4.16% and the 10-yr note yield rose three basis points to 3.58%.

  • Nasdaq Composite: +19.4% YTD
  • S&P 500: +8.3% YTD
  • Dow Jones Industrial Average: +0.8% YTD
  • S&P Midcap 400: +1.2% YTD
  • Russell 2000: +0.8% YTD

Reviewing today's economic data:

  • The MBA Mortgage Applications Index fell 5.7% with purchase applications declining 4.8% and refinancing applications dropping 8.0%. 
  • Total housing starts increased 2.2% month-over-month in April to a seasonally adjusted annual rate of 1.401 million (consensus 1.405 million) from a downwardly revised 1.371 million (from 1.420 million) in March. Single-family starts were up 1.6% month-over-month, but only because of a strong 59.5% increase in the West; single-family starts declined in all other regions.
  • Building permits declined 1.5% month-over-month to 1.416 million (consensus 1.438 million) from an upwardly revised 1.437 million (from 1.413 million) in March. Single-unit permits rose 3.1% month-over-month, led by gains in all regions. The weakness in permits was driven by a 9.7% decline in permits for 5 units or more.
    • The key takeaway from the report is that single-family starts and permits were up, which is a welcome sign given the tight supply of existing homes for sale. Even so, the constraints of high financing rates and high prices are evident in single-unit starts being down 28.1% year-over-year and single-family permits being down 21.2% year-over-year.
  • The weekly EIA Crude Oil Inventories showed a build of 5.04 million barrels after last week's build of 2.95 million barrels.

Ahead of the open on Thursday, Alibaba (BABA), Walmart (WMT), KE Holdings (BEKE), Dole plc (DOLE), Bath & Body Works (BBWI) are among the more notable companies reporting earnings.

Looking ahead to Thursday, market participants will receive the following economic data:

  • 8:30 ET: Weekly Initial Claims (consensus 259,000; prior 264,000), Continuing Claims (prior 1.813 mln), and May Philadelphia Fed Survey (consensus -16.0; prior -31.3)
  • 10:00 ET: April Existing Home Sales ( consensus 4.30 mln; prior 4.44 mln) and April Leading Indicators ( consensus -0.5%; prior -1.2%)
  • 10:30 ET: Weekly natural gas inventories (prior +78 bcf)