FT : Gloom mounts over China’s economic recovery

Gloom mounts over China’s economic recovery
Central bank cuts main policy rate as official data shows post-pandemic rebound is fading

China’s central bank has cut its main policy rate for the first time in 10 months as new data reinforced concerns over a stalling post-Covid recovery in the world’s second-largest economy.

The People’s Bank of China trimmed its medium-term lending facility rate, a one-year rate that influences bank funding costs, from 2.75 per cent to 2.65 per cent, amid widespread expectations that Beijing would be forced to take further action to support the economy.

The rate cut came after the central bank this week unexpectedly lowered the seven-day reverse repo rate, an important gauge for short-term banking sector liquidity, and unveiled tax breaks for businesses.

The move, which was accompanied by a disappointing data report for May, signalled official dissatisfaction with the state of the Chinese economy, which was widely expected to bounce back after authorities abandoned strict coronavirus controls at the start of the year.

But growth has remained feeble, hamstrung by a property sector slowdown, weaker demand for exports and a lack of business and consumer confidence.

“We haven’t seen a return to the level of confidence prior to the pandemic,” said Julian Evans-Pritchard, China economist at Capital Economics, describing the recovery as “underwhelming”.

Economists anticipate Chinese policymakers will unleash more support over the coming months, ranging from infrastructure funding to assistance for local governments, which had borne many of the costs of China’s three-year zero-Covid regime and relied heavily on property development for revenue.

Chinese equities were broadly higher following the rate cut, but gains were limited by last month’s underperformance in retail sales and investment. The Hang Seng China Enterprises index of mainland Chinese companies listed in Hong Kong rose 1.4 per cent, while the CSI 300 index of Shanghai- and Shenzhen-listed stocks gained 0.6 per cent.


Data published by the National Bureau of Statistics on Thursday reinforced pessimism over China’s growth prospects, putting pressure on the government’s official full-year target of a 5 per cent expansion, which is already the lowest in decades.

Retail sales and industrial production missed expectations, adding 12.7 per cent and 3.5 per cent respectively year on year in May, down from 18.4 per cent and 5.6 per cent in April. The figures were buoyed by a low base effect comparison with sweeping lockdowns in China’s biggest cities last year.

“The underlying story on the economy is extremely disappointing right now,” said Robert Carnell, Asia-Pacific head of research for ING, in a note to clients. He forecast more stimulus measures to come, adding they were more likely to be fiscal than monetary to encourage spending.

Youth unemployment hit 20.8 per cent, the highest level since records began in 2018, in a further sign of Beijing’s struggle to provide enough jobs for young people. Overall unemployment was static at 5.2 per cent.

The data release also confirmed that China’s vast property sector was still ailing, more than 18 months after it was plunged into crisis by the default of Evergrande, the world’s most indebted developer.

New construction starts in the first five months of 2023 were down 23 per cent year on year by floor area. New home prices rose slightly on the previous month but remained down compared with 2022.


China’s statistics bureau said growth in the second quarter would be “significantly faster” than in the first, when the economy added 4.5 per cent. But it warned that “the international environment was still complicated and severe” and “the foundation for the economic recovery is not yet solid”.

The recovery’s momentum is expected to slow further in June and July as favourable base effects fade from last year’s lockdown in Shanghai, Goldman Sachs wrote in a research note. 

“We expect more (targeted) easing measures in coming months, especially on fiscal and housing, to counteract the persistent weakness in the economy,” Goldman wrote. But the bank cautioned that the magnitude of any stimulus would probably be smaller than in previous easing cycles.

“The takeaway is that things are still soft [in China], and we’ll need to temper expectations for the second half of the year,” said Steve Cochrane, chief Asia-Pacific economist at Moody’s Investor Services.

“There’s got to be some aggressive but very targeted policy measures to get the economy going,” he added, pointing to a policy intervention that “either focuses very sharply on consumer spending . . . or doing something with youth unemployment”.

In currency markets, the renminbi weakened as much as 0.3 per cent against the dollar to Rmb7.1807 after the PBoC announced the medium-term lending rate cut, taking the currency about 4 per cent lower against the greenback year to date and to a six-month low.

FT : Paris Air Show to spotlight aircraft order rush, emissions targets and risi

Paris Air Show to spotlight aircraft order rush, emissions targets and rising defence budgets
Industry executives next week gather for the world’s biggest international aerospace event for the first time since 2019

After a four-year hiatus, the world’s biggest international aerospace gathering, the Paris Air Show, opens next week, with industry executives expecting a spate of multibillion-dollar aircraft deals. 

It will be the first time the industry has gathered in Paris since the Covid-19 pandemic and Russia’s full-scale invasion of Ukraine. Organisers expect close to 2,500 exhibitors from 47 countries to attend the show amid a global rebound driven by resurgent passenger demand for air travel. 

The recovery is underpinning a buying spree from across the globe, from low-cost European airlines as well as Asian and Middle Eastern carriers. Order books at Boeing and Airbus are so full that carriers are having to wait until the end of the decade to receive the most popular single-aisle aircraft.

Meanwhile, defence executives will be meeting with a renewed sense of purpose. Russia’s invasion of Ukraine has triggered a global race to re-arm, as western governments have pledged to increase defence spending after years of shrinking budgets. 


At the same time, headwinds, including soaring inflation, shortages of components as well as labour constraints, have continued to make an impact on aerospace and defence supply chains.

Civil aerospace recovery: can the industry keep pace with demand?
“It’s hard to recall a time when we’ve had the level of demand for aircraft that we have today,” said John Plueger, chief executive of Air Lease, one of the world’s biggest aircraft lessors.

The level of demand is reflected in the rate of lease extensions by airlines, which is high. Historically, 75 per cent of first-run leases would be extended with the current airline, Plueger told the Financial Times. Today, the percentage is “in the mid-90s”. 

Yet, the industry has continued to struggle with persistent supply chain constraints and parts shortages that have limited the production capacity of the aircraft manufacturers and led to delivery delays.

Willie Walsh, director-general of the International Air Transport Association (Iata), said the situation is unprecedented and its members are calling for the organisation to intervene with aircraft manufacturers to find solutions and identify where the pinch points are.

“I have never heard so many people complain about an issue in all of my career. It’s coming from everyone, not being able to access spare parts or the delays in accessing spare parts.”

Delivery rates of Airbus and Boeing will be in the spotlight as the year progresses as evidence that their production is on track. Airbus delivered 63 aircraft in May, significantly up from 20 delivered in January and 46 in February. 

Sash Tusa, analyst at Agency Partners, said the levels were still below the average Airbus needs to be at to show that the production “ramp” is really working. 

Boeing, meanwhile, shipped 50 jets in May. It recently reported a new flaw in the production of its 787 Dreamliner, which could slow deliveries. 

“Our worry is that the upcycle ends before the OEMs have got their houses in order,” Tusa said. “To be fair, there is always a degree of over ordering . . . but the supply situation is certainly getting a bit worse.”


Net zero target: can the industry keep growing and still meet climate promises? 
Sustainability will be the big buzzword at the show. The aviation industry has committed to achieving net zero carbon emissions by 2050 through a mix of new fuel technologies, including the use of sustainable aviation fuels and hydrogen, as well as more efficient aircraft, engines and air traffic management. 

Executives will be at pains to stress that there is a credible path to net zero that will enable the industry to keep growing. 

Environmental groups argue the two do not go hand in hand. “If you want to solve a problem, start by not making it worse,” said Carlos Lopez de la Osa, aviation manager at NGO Transport & Environment.

“If the sector keeps growing, sustainable flying will remain a pipe dream. It’s simple maths: more planes in the sky means more SAF required.”

Iata estimates that a cumulative $5tn will be needed for aviation to achieve net zero by 2050, although executives say policy drivers will be critical to boost production of SAFs and hydrogen.

They insist the industry will continue to grow, if at different rates in differing markets. Airbus this week raised its 20-year forecast for new aeroplane deliveries to 40,850 but trimmed its predictions for growth in the global fleet as airlines focus on replacing older, less fuel-efficient jets. About 80 per cent of the projected deliveries will be single-aisle aircraft such as the Airbus A320neo or Boeing 737 Max.

In Europe, airlines are facing an increased cost for their carbon emissions. The EU is also negotiating rules to enforce the uptake of SAFs as well as potential increased taxes on kerosene. 

According to Iata’s Walsh, the EU has an “anti-aviation leaning”.

“[In] Europe in particular, the view is that you can retain all the economic and social benefits that you have derived from aviation at the same time as you are suppressing it. I disagree with that.”

Rush to increase defence budgets after invasion of Ukraine
The war in Ukraine and how to keep supplying and upgrading the military capabilities of its armed forces will be a central topic at the show. 

Western defence stockpiles of everything from ammunition to rocket launchers have been significantly run down over the past year. The shift to a war footing has created a supply chain crisis as companies have ramped up production to replenish inventories while maintaining supplies to Ukraine. 

Global military spending reached an all-time high last year of $2.1tn, according to a report by AlixPartners that warns that the sector will “likely continue to suffer from an unavailability of qualified labour, a fragmented supplier base and challenging financing”. 

In Europe, the war has galvanised efforts to make good on previous promises to turn the bloc into a cohesive military power. There are proposals for greater collaboration and the streamlining of weapons manufacturing. But success is not guaranteed.


Countries such as Germany turned to US manufacturers for their latest fighter jet orders, with Lockheed Martin’s F35s, disappointing France’s Dassault Aviation, makers of the rival Rafale. The French group has also noted that European countries considering sending jets to Ukraine have been considering US-made models such as the F16. 

“In the Ukraine conflict, . . . European countries are turning more easily to US models than European models, be it the Rafale, [the Swedish-made Gripen] or the [Airbus/BAE Systems] Typhoon, which is a bit sad for us Europeans,” Dassault chief executive Éric Trappier said earlier this month. 

Jan Pie, secretary-general of ASD, the European industry’s trade association, said countries need to change the ratio of their defence budget “in favour of more European spendings”. 

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Today, just 40 per cent of individual European countries’ defence procurement spend with industry ends up in Europe with domestic companies. “If we wish to reach industrial sovereignty a good starting point would be to switch those numbers to 60/40 in favour of Europe,” said Pie.

Institutional investors also need to be persuaded to back the sector. Before the war, some socially conscious investors had started to cut their ties to the industry. 

Although the conflict has led to some investors adapting their investment policies, there was a need for formal clarifications from the EU that allocating capital to the defence industry did not in any way contradict the block’s ESG criteria. “As long as this formal clarification is missing, the major trends will not shift,” he said.

>>> US After Hours Summary: Relatively hushed after-hours session; POWW +11.8%, LEN +2.2% both up on earnings; TRUE +9.7% higher on restructuring; Crypto-related names edging lower in sympathy with tumbling Bitcoin price

After Hours Summary: Relatively hushed after-hours session; POWW +11.8%, LEN +2.2% both up on earnings; TRUE +9.7% higher on restructuring; Crypto-related names edging lower in sympathy with tumbling Bitcoin price

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: POWW +11.8%, LEN +2.2%

Companies trading higher in after hours in reaction to news: TRUE +9.7% (reduces workforce and appoitns new CEO), WRB +4.3% (increases dividend), VTNR +4% (receives EPA approval), ENS +1.9% (MoU with Verkor SAS), PINC +1.3% (to divest GPO operations), HST +0.8% (increases dividend), PHG +0.7% (will repurchase EUR 132 mln of shares), CIM +0.3% (decreases dividend), JKS +0.1% (launches next-gen storage battery in Europe)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: None

Companies trading lower in after hours in reaction to news: GAMB -10.6% (stock offering), EDIT -5.4% ($125 mln stock offering), BITO -3% (moving in sympathy with Bitcoin), MARA -2.9% (moving in sympathy with Bitcoin), VLRS -2.5% (investment agreement to accelerate sustainable aviation fuel), MSTR -2.4% (moving in sympathy with Bitcoin), RIOT -1.7% (moving in sympathy with Bitcoin), COIN -1.7% (moving in sympathy with Bitcoin), ALGT -0.9% (reports May 2023 traffic), IRT -0.9% (files mixed shelf), RTX -0.2% (Safran nearing $1.8 bln deal to acquire RTX unit, according to Reuters

>>> US Close Dow -0,68% S&P +0,08% Nasdaq +0,39% Russell -1,17%

Closing Stock Market Summary

The major indices hung around in fairly narrow ranges until the much anticipated FOMC decision at 2:00 p.m. ET and Fed Chair Powell's press conference at 2:30 p.m. ET induced some whipsaw action.

The FOMC voted unanimously to hold the target range for the fed funds rate steady at 5.00-5.25%, yet stocks declined with the release of the Summary of Economic Projections, which showed an upward adjustment in the 2023 median estimate for the fed funds rate to 5.60% from 5.10%.

The market started to climb again as Fed Chair Powell's press conference got underway. Stocks recovered after Fed Chair Powell said that the July meeting is a "live" meeting (for looking at a possible policy change), but one that isn't being pre-determined.

In other words, a rate hike in July isn't a sure thing. Note that there are four more FOMC meetings this year (July, September, November, December), so the Fed doesn't have to frontload an additional 50 basis points of rate hikes. Arguably, the stock market is making some allowance for the possibility that the Fed might not push the policy rate as far as the dot-plot suggests it might go this year.

The mega cap stocks helped the S&P 500 and Nasdaq close with gains, yet there wasn't much concerted selling under the index surface. The Vanguard Mega Cap Growth ETF (MGK) rose 0.6% while the Invesco S&P 500 Equal Weight ETF (RSP) fell by a modest 0.2% after being up as much as 0.6% earlier in the day. The S&P 500 for its part settled the session roughly unchanged from where it was trading just before the 2:00 p.m. ET policy directive was released. 

The Dow Jones Industrial Average (-0.7%), held down by a sizable loss in UnitedHealth (UNH 459.86, -31.45, -6.4%) after the company warned of rising costs, and the Russell 2000 (-1.2%) lagged the other major indices today.

Market breadth reflected an underlying negative bias, but only modestly so. Decliners led advancers by a roughly 5-to-3 margin at the NYSE and at the Nasdaq. 

Most of the S&P 500 sectors closed with losses. The energy (-1.1%) and health care (-1.1%) sectors were the only laggards to decline more than 1.0%, the latter of which was weighed down by UnitedHealth and other managed care stocks. The information technology sector (+1.1%), meanwhile, was the best performer by a wide margin thanks to its mega cap and semiconductor components. The PHLX Semiconductor Index rose 1.5%. 

The 2-yr note yield settled unchanged at 4.70% and the 10-yr note yield fell four basis points to 3.80% in a rollercoaster trade.

  • Nasdaq Composite: +30.2% YTD
  • S&P 500: +13.9% YTD
  • Russell 2000: +6.4% YTD
  • S&P Midcap 400: +5.6% YTD
  • Dow Jones Industrial Average: +2.5% YTD

Reviewing today's economic data:

  • The weekly MBA Mortgage Applications Index rose 7.2% with purchase applications jumping 8.0% and refinancing applications rising 6.0%. 
  • The Producer Price Index for final demand declined 0.3% month-over-month in May ( consensus -0.1%) while the index for final demand, less foods and energy ("core PPI) increased 0.2% month-over-month, as expected.
  • On a year-over-year basis, the index for final demand was up 1.1% year-over-year, versus 2.3% in April, and the index for final demand less foods and energy was up 2.8% year-over-year, versus 3.2% in April.
    • The key takeaway from the report is the recognition that wholesale inflation is moving in the right direction, which should be pleasing to the Fed and a reprieve for corporate profit margins.
  • Weekly EIA crude oil inventories showed a build of 7.92 million barrels following last week's draw of 451,000 barrels.

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

  • 8:30 a.m. ET: May Retail Sales ( consensus 0.0%; prior 0.4%), Retail Sales ex-auto ( consensus 0.1%; prior 0.4%); Weekly Initial (consensus 251,000; prior 261,000) and Continuing claims (prior 1.757 million); June Philadelphia Fed Index ( consensus -13.0; prior -10.4); June Empire State Manufacturing ( consensus -16.0; prior -31.8); May Export Price Index (prior 0.2%), Export Prices ex-ag. (prior 0.4%), Import Price Index (prior 0.4%), Import Prices ex-oil (prior 0.0%)
  • 9:15 a.m. ET: May Industrial Production ( consensus 0.1%; prior 0.5%), Capacity Utilization ( consensus 79.7%; prior 79.7%)
  • 10:00 a.m. ET: April Business Inventories ( consensus 0.2%; prior -0.1%) 
  • 10:30 a.m. ET: Weekly EIA Natural Gas Inventories (prior +104 bcf)
  • 4:00 p.m. ET: April Net Long-Term TIC Flows (prior $133.3 billion) 

Reuters : Microsoft, Activision ask judge for speedy schedule in FTC challenge

Microsoft, Activision ask judge for speedy schedule in FTC challenge

WASHINGTON, June 14 (Reuters) - Microsoft (MSFT.O) and Activision Blizzard (ATVI.O) asked a U.S. judge on Wednesday to quickly schedule a case management conference in the Federal Trade Commission's legal bid to block the companies from completing a $69 billion tie-up.

U.S. District Judge Edward Davila on Tuesday set a June 22-23 evidentiary hearing and temporarily blocked the parties from completing the deal pending a future decision on whether to grant a preliminary injunction.

"Time is of the essence," the companies wrote in a court filing, noting that Microsoft's agreement to acquire Activision has a termination date of July 18 and contains a $3 billion termination fee. "Let there be no doubt, a preliminary injunction ruling is the only decision that matters under these challenging deadlines."

WWD : Adidas China Chief Adrian Siu Details Turnaround Plan, Localization Strate

Adidas China Chief Adrian Siu Details Turnaround Plan, Localization Strategies
The Greater China chief spoke to WWD after a year at the helm of the German sportswear giant, which is going through a "transitional period" in an increasingly competitive Chinese market.

SHANGHAI — When Adidas‘ local manufacturing and franchise partners arrived at the brand’s spring summer 2024 trade show, they were welcomed by an outsized Chinese slogan that can be directly translated as “Adidas still got it.”

With wholesale sales still a big chunk of the business, Adidas’ closed-door “brand show,” one of the largest since China slashed COVID-19 restrictions, hosted more than 2,000 vendors at a Wuhan sports stadium.

The slogan, albeit modest in tone, portrayed the candid stance that the German sportswear giant is actively taking in the market, where it hopes to be rebranded as a “In China, for China” company, according to Adrian Siu, the company’s Greater China chief for the past year.

Siu, who has served in multiple roles for Adidas in Hong Kong and Shanghai, was most recently the chief executive officer of Cosmo Lady, China’s largest underwear maker.

A major task for Siu is to rework the brand as “one of the most profitable markets” for Adidas in the long run, as Adidas’ new CEO Bjørn Gulden noted during the company’s first-quarter earnings call.

After the BCI controversy, coupled with COVID-19 lockdown woes and the Yeezy crisis, the company’s Greater China arm has been on a losing streak for seven consecutive quarters. Last year, sales in the market plunged 36 percent to 3.2 billion euros, just half of 2019 levels.

For the first quarter of this year, revenue in the Greater China market continued to fall by 9 percent, but the company highlighted sell-out growth, or the amount of Adidas goods sold through its retail partners, which resumed “double-digit growth” in the period.

Increased competition from domestic players has made it harder for Adidas to engineer a quick turnaround.

Last year, Anta surpassed both Nike and Adidas to become the biggest sportswear brand by revenue in China. A brand synonymous with Chinese pride, the market gains prompted Anta company chairman Shizhong Ding to become the richest man in the country’s apparel business. According to the local ranking platform “New Fortune 500,” Ding’s wealth reached 90.3 billion renminbi, or $12.6 billion, in 2023.

At Adidas, a gloomy outlook persists. At the group level, the company expects currency-neutral revenues to decline at high-single-digit rates due to “uncertainty around the China recovery,” revenue lost from unsold Yeezy inventory, macroeconomic challenges and geopolitical tension.

But the soft-spoken Siu remains confident that Adidas can ride the tailwind of a burgeoning sportswear market in China driven by policy incentives and change of lifestyles post-lockdown.

Based on Euromonitor estimates, China’s sportswear apparel market is expected to grow by 10.5 percent to 401 billion renminbi, or $55.9 billion.

Adidas remains a market leader, in particular in the premium category, accounting for 11.2 percent of China’s sportswear market in 2022, according to data from Euromonitor.

Numbers aside, Siu has spent the last year rebuilding Adidas’ relationship with Beijing while pushing a patriotic-driven clothing line.

In November, not long after German Chancellor Olaf Scholz’s Beijing visit, the company signed a strategic agreement with the Chinese Literature and Art Foundation, which will materialize in a series of documentaries that pay tribute to the nation’s sports heroes and pioneers. A partnership with Chen Xiao, a Chinese actor, will help bring the program to grade schools around the country.

At the Wuhan trade show, an army of models showcased the latest collection from the kung fu master-inspired Wuji collection, as well as Adidas’ iconic tracksuits with “China” splashed across them in Chinese.

The message for 2024 already rang loud and clear: “Adidas appreciates Chinese culture, respects the Chinese consumer, and wants to support and promote sport in China so that everyone in China can have the power to change life and become healthier,” Siu reiterated during an interview with WWD in Shanghai.

Asked about how Adidas plans to go head-to-head with rising local sporting goods giants, most notably Anta, Siu continued to enthuse about Adidas’ chance to further engage with Chinese consumers and Chinese athletes on all fronts.

“I was so happy to see our tennis player Wang Xinyu win the French Open women’s doubles yesterday. It’s a first for China,” said Siu. “We are ready, we are prepared, and we welcome the competition, as long as it is healthy competition.”

Apart from Wang, Adidas is quickly adding more local athletes to its fold. The brand has signed Wu Yibing, the first Chinese player to win an ATP title, and the 17-year-old Chinese breakdancer Liu Qingyi, who Siu is betting on to be a star athlete at next year’s Paris Olympics.

A boost to the brand’s logo came this week in Beijing as the Adidas-sponsored Lionel Messi is due to play a friendly football match against Australia on Thursday at the Bird’s Nest Stadium, the capital city’s outsized venue. But to Messi fanatics’ dismay, a scheduled meet-and-greet at Adidas’ Sanlitun Beijing flagship was canceled at the last minute due to safety concerns. Per local media reports, the need to “stay away from commercial activities” was also a part of the consideration.

More localized collections are also in the works. Siu revealed to WWD exclusively that Adidas will launch a collaboration with Chinese designer Rui Zhou, who’s known for her ultra-sexy knitwear, on a movement and dance-focused collection.

A snowboarding apparel line designed by Chinese snowboarder and Olympic champion Su Yiming will be introduced later this year.

Despite news circulating on Chinese social media that a linkup with Edison Chen and his streetwear label Clot is due to be unveiled this fall, Siu declined to comment.

“I’m not allowed to answer this, but I can tell you that we will work with a lot of great talents. They have very strong intellectual power in both the cultural and sneaker circles,” said Siu.

Adidas is also doubling down on speed-to-market via Consumer Creation Shanghai, or CCS team. The 80-person market research and design team is responsible for creating products that answer directly to Chinese consumer needs and can churn out new releases in a time frame that ranges from a few weeks to three months, depending on material availability.

“If we want to win in the market today, I think we also need to increase our speed, become more agile, more responsive, and have a better balance between supply and demand,” said Siu.

The new athleisure line Adidas Sportswear has been a major testing ground for the CCS team, which has been performing “up to expectations” since products hit the shelves in March.

The plan is to design at least 30 percent of all Adidas products sold in China locally, up from a figure in the low single digits three years ago.

With a new travel craze centered around camping and embracing the great outdoors — the market is projected to reach around $14 billion by the end of 2023, according to Tmall — the CCS team is planning to add more talent to double down on outerwear that can compete with a rising number of global and homegrown outdoors brands.

Siu is still gazing into the crystal ball to gauge when Adidas will become relevant and cool again, but recent linkups with luxury and fashion labels, including Prada, Balenciaga, and Gucci, help. Case in point: its most recent collaboration with Grace Wales Bonner unexpectedly created a “liquid silver” frenzy on Xiaohongshu, with mentions topping the 240,000 mark. The metallic Samba style quickly sold out on Adidas Original’s Confirmed app.

In the short run, Siu would like to focus on more small, even unexpected wins like this.

“We want to have a more long-term sustainable business in China. We are in a marathon, not a sprint,” said Siu. “We still have many, many years in the market. We want to win the hearts of Chinese consumers, but first, we need to keep improving our products, our storytelling, and our speed to market.”

WWD : Kering Launches Corporate Communications and Event Strategy

Kering Launches Corporate Communications and Event Strategy
To mark its 10th anniversary, the company will launch a corporate ad campaign, book and film, as well as host a series of cultural and charity events, to raise awareness of its history and brand values.

PARIS — To mark its 10th anniversary, Kering will launch a broad communications and event strategy to raise awareness of its history and brand values.

The former Prinault-Printemps-Redout, or PPR, became Kering in June 2013, as it morphed into a pure luxury and fashion player under the direction of chairman and chief executive officer François-Henri Pinault.

To celebrate a decade of the moniker, the company plans a number of projects to raise awareness and and brand recognition of the Balenciaga, Bottega Veneta, Gucci, Alexander McQueen and Saint Laurent parent company.

A corporate advertising campaign will be launched in the third quarter of the year to shine a spotlight on the Kering corporate name and its role in the luxury world.

Cesar-nominated documentary directors Thierry Demaizière and Alban Teurlai are working on a film about the history of the group and its current activities, which is slated for release near the end of the year.

French publisher Flammarion will also release a book on the history of Kering from its inception through its transformation into a luxury company.

Event festivities will kick off June 21, both the summer solstice and celebrated as the Fête de la Musique in France, with a party at the corporate headquarters in Paris. New York-based employees will celebrate in the same way the next day, with additional events planned in Milan, Shanghai, Hong Kong and Tokyo throughout the year.

The company’s philanthropical arm, the Kering Foundation, will host a major fundraiser in New York on Sept. 12. The event will celebrate the 15th anniversary of the foundation and its work to combat gender stereotypes and eradicate violence against women.

A few days later on the weekend of Sept. 16, the company will once again open the doors of its headquarters in Paris for the country’s Heritage Days. Located the former Laennec hospital, the sprawling property will host an exhibition of Balenciaga haute couture curated by the house’s current creative director Demna. It will also host an installation of contemporary art from the artist Rachel Whitread, supported by the Pinault Collection, as well as an immersive installation on the history of Kering.

Later in the month, the company will host a gathering devoted to the organizations, projects and initiatives it has supported, including sustainability projects and NGOs, over the years.

Kering, pronounced “caring,” comes from the root “Ker,” a local language word meaning “home” that harks back the company’s origin as a timber trading company in the northern coastal region of Brittany in 1963.

FT : Fresh blow to City as WE Soda pulls $7.5bn London IPO

Fresh blow to City as WE Soda pulls $7.5bn London IPO
Industrial material producer blames ‘cautious investors’ over what had been set to be LSE’s largest listing this year

WE Soda has abandoned plans for a $7.5bn London initial public offering in a fresh blow to UK equities capital markets that have struggled to attract marquee listings in recent years.

The UK-based group, which is the world’s largest natural soda ash producer, blamed the decision on “extreme investor caution in London” that prevented it from garnering the valuation it had sought to achieve.

In a statement on Wednesday, WE Soda chief executive Alasdair Warren said that “investors, particularly in the UK, remain extremely cautious about the IPO market”.

WE Soda, which has two production sites in Turkey and had planned to become a “big fish” in London’s relatively smaller capital market, cancelled its planned float after it found the market was seeking to pay roughly 30 per cent less than it had hoped for, according to three people familiar with the matter.

Soda ash is used in industrial processes like glass production, and is a component in products ranging from batteries to detergents.

The listing of the company, which is controlled by Turkish media and industrial mogul Turgay Ciner, was set to be the UK’s biggest flotation of 2023 with the group expecting to join the FTSE 100.

However, a person familiar with the matter said that senior executives at the company had mishandled discussions with investors, compounding concerns about management holding zero shares in the group. Before joining WE Soda, Warren worked as a senior capital markets banker at Goldman Sachs and Deutsche Bank in London.

WE Soda’s decision to back out of the UK IPO is the latest setback to London’s equities market, which has struggled in recent years as big companies have chosen to list on large venues such as Wall Street. There were just four London listings in the first quarter, raising only £81mn, the sixth-worst quarter for IPOs in the UK capital since 1995.

London has suffered from other large industrial companies pulling their listings in recent years because of turbulent market conditions. In 2021, private equity group Advent explored taking factory parts supplier Rubix public in London, with an intention to raise €850mn before scrapping the plans.

Meanwhile, Arm, the chip designer, rejected an appeal by the government to list in the UK and CRH, the world’s largest building materials group, plans to switch its listing to Wall Street.

The collapse of the WE Soda listing is a setback for Rishi Sunak’s ambitions to improve London’s reputation as a destination for big IPOs.

But government officials insisted that the decision was not a hammer blow to the City’s reputation, pointing out there had been a period of low issuance in most major markets in recent months. 

A banker familiar with the WE Soda process said investors were not prepared to buy at the price that the company was looking for, despite the generous offer to pay more than $500mn of dividends.

“The transaction was possible but at a price level where the owner was not going to do it,” the person said. “We should not write off the entire IPO market but it is pretty difficult.”

Warren told the Financial Times on Tuesday that the company had received “massive” interest, holding about 300 investor meetings.

He said WE Soda had faced three challenges with investors: poor IPO market conditions, low understanding of the soda ash industry and convincing them of the sustainability of its margins in the coming years.

“This question is this issue of caution in terms of the IPO market and ‘what discount’ they demand for that caution,” he said.

In response to the news, City minister Andrew Griffith said: “We continue to attract some of the most innovative and largest companies in the world and firms will have unique features and competing reasons to list in capital markets across the globe.

“The UK is taking forward ambitious reforms to the rules governing its capital markets, including through the Edinburgh Reforms to build on our continued success as Europe’s leading hub for investment, and the second largest globally.”