TheChek News Flow

Alexander Wynaendts has reduced his other board commitments after investor criticism

Deutsche Bank is seeking to increase the pay of its supervisory board chair by more than 40 per cent, despite Alexander Wynaendts already being the highest-paid chair of Germany’s blue-chip Dax companies.

The country’s largest lender plans to ask shareholders at its 2026 annual meeting to approve an increase in Wynaendts’ total supervisory board pay to about €1.4mn, up from €950,000 for 2024, three people briefed on the plans said.

His pay already exceeded that of any of his peers in the Dax 40 last year, with Allianz chair Michael Diekmann earning about €760,000 and Volkswagen’s Hans Dieter Pötsch on around €680,000.

Part of the planned increase would come from raising fixed pay for the chair by between 10 and 20 per cent, a change that would also lift the basic remuneration for other supervisory board members, one person familiar with the discussions said.

The rest would stem from changes to how committee work is remunerated. The chair currently does not receive any additional pay for chairing committees, while other supervisory board members receive between €100,000 and €150,000 per committee they lead.

Wynaendts heads both the chairman’s committee and the nomination committee and is expected to continue in those roles.

The proposal had not yet been finalised and would be put forward along with other resolutions when Deutsche publishes the notice of its 2026 shareholder meeting, the people added.

Both the bank and Wynaendts declined to comment.

A person familiar with Deutsche’s position said the planned pay rise was aimed at keeping the role competitive internationally, arguing that chairs of supervisory or non-executive boards at other large European banks earn significantly more than Wynaendts.

Wynaendts had been criticised by some investors for holding too many mandates alongside what they viewed as a demanding position at Deutsche.

In response, Wynaendts stepped down as chair of Dutch investment company Puissance Holding, according to a person briefed on the matter, although he remains on the board. He also continues to sit on the boards of Air France-KLM and Uber Technologies.

Brendan Nelson, who was last week confirmed as the chair of Europe’s largest lender HSBC, is paid £1.5mn (€1.7mn) for a role regarded as one of the toughest in banking. Nelson receives no additional fees for his other roles at the bank.

Formerly chief executive of Dutch insurer Aegon, Wynaendts took over as chair of Deutsche in 2022 after years of scandals, litigation and restructuring at Deutsche.

Since his appointment in May that year, the bank’s profitability and share price have recovered and its performance has moved closer to that of large European rivals.

Wynaendts is now grappling with fresh legal fallout from a scandal dating back more than a decade, which relates to Deutsche’s involvement in structuring trades for Monte dei Paschi di Siena.

Several former Deutsche managers have launched claims against the lender, alleging that its actions damaged their careers.

One former senior banker, Dario Schiraldi, is suing Deutsche for €152mn in Frankfurt, while five others have filed lawsuits in London’s High Court seeking hundreds of millions of pounds in damages.

Michael Saylor’s financial engineering inspired dozens of imitators but is now close to unravelling

Two weeks after posting an AI-generated picture of himself fleeing a sinking ship, Michael Saylor last Monday floated a once unthinkable idea: that his company Strategy might soon sell some of its 650,000 bitcoins.

The prospect of one of bitcoin’s most outspoken evangelists offloading the tokens shows how gravely the recent digital asset slump threatens the crypto-financial machine that Saylor has built.

At the heart of his predicament is the quickly narrowing gap between Strategy’s valuation in the stock market and the value of the bitcoin on its balance sheet.

The premium which Strategy’s stock commands over its bitcoin holdings has dropped to a five-year low — its shares have fallen far faster than the cryptocurrency — and is at risk of disappearing altogether.

If the premium vanishes, Strategy’s “entire business model breaks”, said David Krause, emeritus associate professor of finance at Marquette University.

“It’s like a flywheel that only works when investors are willing to pay more than the bitcoin is worth,” Krause wrote in a recent paper. When the premium disappears, “that flywheel reverses.”

Saylor’s success in transforming a sleepy enterprise software company into a moneymaking juggernaut fuelled by bitcoin has led to a posse of imitators, turning public companies into crypto-hoarders. The crypto sell-off is now exposing their financial weakness.

While the stock traded at a large premium, Strategy sold tens of billions of dollars of convertible bonds, common stock and other equity-linked instruments to fund its bitcoin-buying spree.

Its relentless accumulation of the world’s most valuable digital asset propelled its shares 1,200 per cent higher since its first purchase in 2020.

But after peaking at a $127bn valuation in July, its share price has plunged nearly 60 per cent. That has left Strategy with an enterprise value just 1.16 times its bitcoin holdings, having been worth twice as much in June.

Saylor has acknowledged the premium’s crucial role. As long as Strategy’s enterprise value exceeds its net asset value, “the most efficient thing . . . to do is to sell the equity”, Saylor said in a presentation last week.

If the company traded at a discount, he added that “yes, we could sell the bitcoin.”

Saylor has long measured the company’s success through a metric he created, Strategy’s so-called bitcoin per share. While the premium lasts, each new share issued to fund bitcoin purchases boosts shareholders’ bitcoin per share.

That model has come under increasing strain as Strategy’s share price has slumped. The company has warned it could incur a $5.5bn net loss if bitcoin were to end the year at $85,000. The company previously forecast it would trade at $150,000 by year’s end.

Its decision to launch a huge US dollar reserve to cover its dividend payments marked another U-turn for a company whose widely imitated business model centres on bitcoin being the only form of currency worth holding.

“It’s pure comedy,” said one US hedge fund chief investment officer who had bet against Strategy earlier this year.

Investors who had bet on Strategy’s premium eventually collapsing — by going long bitcoin while shorting the company’s shares — have profited from the decline.

New York-based hedge fund Kerrisdale Capital was among the first investment groups to enter the trade, calling out Strategy’s voracious appetite for capital and what it described as the company’s “bloated” valuation in March 2024. Jim Chanos, one of Wall Street’s best-known short sellers, closed his short-Strategy, long-bitcoin trade after 11 months in November.

Strategy did not respond to a request for comment.

Saylor’s most fervent fans have dismissed suggestions that his recent pivot to amassing dollars amounted to an admission of defeat.

“Is this what he wanted to do? Absolutely not. But [the announcements] are still steps and bridges and tools to get to the end goal: to accumulate more and more bitcoin,” said Ed Juline, Strategy’s former director of bitcoin advocacy. “Saylor’s a genius and 100 per cent committed to what he’s doing.”

For the time being, the dividend and coupon payments owed on Strategy’s various debt instruments are covered for 19 months by its new $1.4bn US dollar reserve, according to Saylor.

Much depends on how the crypto market performs. Brett Knoblauch, a crypto analyst at Cantor Fitzgerald, said in a note it would “not take much for Strategy’s [premium] to revert higher, which would then spur more capital raising and bitcoin accumulation”.

“The most obvious catalyst would be for bitcoin to break out above [all-time highs] of around $125,000,” he added.

Equally, further falls in crypto or a protracted loss of its premium would leave Strategy stalled — burning cash to meet its obligations and constrained in its ability to raise new capital.

Looming over the company is MSCI’s upcoming decision on whether to exclude from its indices Strategy and other bitcoin treasury companies that resemble investment funds.

That ruling could prove “pivotal,” JPMorgan analyst Nikolaos Panigirtzoglou wrote in a note to clients late last month. He estimated that being dropped from the indices could drain $9bn from the company’s valuation as inflows from index-tracking funds dried up.

Cantor’s Knoblauch last week slashed his 12-month price target for the stock by 60 per cent, even as he warned that investors’ “fear” about Strategy’s direction and narrowing premium “is not warranted”.

Connection priority given to those ready to build in bid to meet clean power 2030 target

Britain’s energy system operator is prioritising hundreds of projects for connection to the electricity grid before 2030 while hundreds of others will be forced to wait under plans to speed up the shift towards lower-carbon electricity.

The National Energy System Operator (Neso), a public body, will announce the results of an overhaul of the queue to access the grid on Monday, after a massive backlog developed under the previous grid connection rules.

Under the new plans, grid connection dates before the end of the decade will be offered to almost one-fifth of the energy and storage projects in the queue, about 131.6 gigawatts out of roughly 700GW.

They have been chosen for their readiness to build and the extent to which they will help meet the government’s target of decarbonising the electricity system by then.

A further 151.3GW will be offered connection dates by 2035, while at least 300GW will not currently be offered to connect before then.

The changes follow huge frustration among industry and government over a massive backlog, which has meant years-long waiting times to connect for many projects.

The current queue of 700GW is about four times more than Britain needs to meet its clean power 2030 target, and is at least one and a half times more than the installed capacity Neso expects will be required by 2050. Britain’s entire current installed capacity is about 110GW.

Officials believe many of those in the existing queue are speculative projects unlikely to get built and are now clogging up the system.

The changes are likely to be welcomed by developers whose projects are being prioritised and should lead to a smoother system.

However, they are likely to infuriate and potentially bring legal challenges from developers who feel their projects have been unfairly downgraded.

One industry source said there would be “winners and losers” from the overhaul. Another warned: “There are going to be some smaller [generation] developers that are completely screwed by this process.”

The bulk of those getting connection dates in the first phase are battery projects (34.5GW), followed by offshore wind (32.1GW) and solar (29.9GW).

Meanwhile, Neso says that about 12 per cent (11.8GW) of the almost 100GW of large electricity consumers waiting to connect to the high-voltage transmission system — much of which are data centres — will be offered connection dates by 2030, with the rest by 2035.

This is based on the readiness of projects and network companies, as opposed to their compatibility with clean power targets.

The plan to overhaul the queue for power stations was put in motion by the government at the end of last year, marking a more state interventionist approach to the energy sector.

Neso, which does not build the connections itself, oversees the electricity system and contracts with developers wanting to access the grid.

The connections are built by the owners of the networks, such as the FTSE 100 companies National Grid in England and Wales, and SSE in Scotland. 

One of the industry sources questioned whether the network owners would definitely be able to deliver the connections according to the new plan, given pressures on supply chains.

“It remains to be seen whether the outcome will be worth the process,” they said.

Ed Miliband, the energy secretary, described the reforms as a “once in a generation” process to “clean up the queue and prioritise the projects that are ready to help us deliver clean power by 2030”.

“Accelerating the process of connecting up new projects could unlock up to £15bn of investment in offshore wind alone,” said Barnaby Wharton, RenewableUK’s head of flexibility and grid.

This will “significantly” strengthen Britain’s energy security, he added.

Exports soar despite tensions between Washington and Beijing

China’s year-to-date trade surplus in goods has surpassed $1tn for the first time, as exports boom despite US President Donald Trump’s tariff war.

In the first 11 months of this year, China’s trade surplus in dollar terms was $1.076tn, according to data released on Monday by the country’s customs administration, which covers goods but not services.

China’s trade surplus in goods for the full year in 2024 was just shy of $1tn.

The record surplus comes in the wake of a de-escalation in trade tensions between Washington and Beijing, which agreed a yearlong truce in October.

The large gap between exports and imports has drawn criticism from China’s trading partners, with French President Emmanuel Macron pointing to “unbearable” imbalances on a visit to China last week.

China’s exports rose 5.9 per cent in November on a year earlier, while imports added 1.9 per cent, leading to a surplus of $112bn for the month.

Exports to the US have cratered in recent months, and fell 29 per cent in November year on year.

But shipments to other regions, especially south-east Asia, have grown rapidly. Economists believe some of these shipments to south-east Asia, which added 8 per cent last month, are later trans-shipped to the US.

“I think the crux of the matter . . . is that the US hasn’t clamped down on trans-shipments of goods via third-party countries,” said Carlos Casanova, chief Asia economist at UBP.

He added that US demand had been “stable”.

“Because you don’t see a decline in US demand, the region continues to see a surge in exports, and China is benefiting indirectly from that,” he said.

Xi Jinping’s government has relied heavily on exports to drive economic activity amid weak domestic demand and a property slowdown now entering its fifth year.

China was poised to increase its share of global exports to 16.5 per cent by 2030, from 15 per cent now, Morgan Stanley analysts said in a report, adding that they doubted increasing protectionist measures from trading partners could halt this advance.

“Given its dominant position in high-growth emerging sectors like EVs, batteries, and robotics, we believe China will continue to strengthen its position in global manufacturing and trade,” the Morgan Stanley analysts led by chief Asia economist Chetan Ahya wrote.

WASHINGTON, Dec 7 (Reuters) - U.S. President Donald Trump said on Sunday that he would have a say whether a proposed merger between Netflix and Warner Brothers should go forward, telling reporters the market share of a combined entity could raise concerns.

"I'll be involved in that decision," Trump told reporters as he arrived at the Kennedy Center for its annual awards show.

Netflix (NFLX.O), opens new tab on Friday agreed to buy Warner Bros Discovery's (WBD.O), opens new tab TV, film studios and streaming division for $72 billion, a deal that would hand control of one of Hollywood's most prized assets to the streaming pioneer.

Trump did not say whether he favored approval for the deal, but he pointed to a potential concentration of market power in the entertainment industry.

"That's going to be for some economists to tell…. But it is a big market share. There's no question it could be a problem," Trump said.

Deal for data-infrastructure company could come as soon as Monday

International Business Machines is in advanced talks to acquire data-infrastructure company Confluent CFLT -0.90%decrease; red down pointing triangle for around $11 billion, according to people familiar with the matter.

A deal could be announced as soon as Monday, the people said, cautioning that the talks could still fall apart.

Confluent had a market value of around $8 billion as of Friday, while IBM’s was around $290 billion.

Confluent provides technology that helps manage streams of real-time data used in big artificial-intelligence models. An AI boom has boosted the need for its capabilities from companies in sectors including retail, technology and financial services.

An acquisition of Confluent would be the biggest deal for IBM in recent memory as it repositions its business around AI.

Last year, it agreed to buy cloud-software provider HashiCorp for $6.4 billion, in a deal that pushed it further into fast-growing cloud and AI offerings.

In October, IBM posted higher revenue in the third quarter, boosted by higher-than-expected growth in its consulting business. IBM in November said it would lay off thousands of employees before the end of the year, joining other technology companies that are repositioning themselves in the age of artificial intelligence.

IBM has been competing with Google, Microsoft and a number of startups to build computers that exceed the abilities of the best conventional ones. It is working on larger clusters of quantum chips that it expects will enable large-scale computing in the next five years.

Chief Executive Arvind Krishna recently said IBM has used AI—specifically AI agents—to replace the work of a couple of hundred human-resources workers. That has enabled it to hire more programmers and salespeople.

Technology has been one of the busiest sectors for dealmaking this year. Google parent Alphabet struck a $32 billion deal for cybersecurity startup Wiz. Palo Alto Networks agreed to a $25 billion deal for CyberArk. And Salesforce struck an $8 billion deal for data-management software firm Informatica.

US president says he will be involved in decision over media merger

Donald Trump said Netflix’s “very big market share” in streaming video could pose a problem as it seeks regulatory approval for its blockbuster $83bn deal to acquire Warner Bros. 

“They have a very big market share and when they have Warner Brothers that share goes up a lot,” he said. “It could be a problem,” he added. 

The combination of Warner’s HBO MAX service and Netflix would put the company over the 30 per cent US market share threshold. But Netflix is expected to argue that other streaming services, including YouTube, should be considered when surveying the marketplace.

Netflix emerged as the winner of the Warner Bros auction on Friday, topping rival offers from Paramount and Comcast. The union representing Hollywood screenwriters was among the industry voices arguing that the deal should be blocked. 

Trump said he “would be involved in that decision” about whether to clear the transaction. When AT&T struck a deal to buy Time Warner during the first Trump administration, there was a lengthy battle with the justice department before it was finally approved. The Netflix-Warner deal is also expected to receive scrutiny from the Department of Justice. 

Trump said Ted Sarandos visited him at the Oval Office for a meeting last week, adding that the Netflix co-chief executive did not give him any guarantees about the Warner deal when they met.  

In his brief remarks on Sunday, Trump called Sarandos a “great person” and compared him with Louis B Mayer, the movie mogul who co-founded the Metro-Goldwyn-Mayer studio in 1924.

“I think he’s fantastic,” he said of Sarandos. “I have a lot of respect for him. In the history of Hollywood you could say there’s been nothing like what he’s done. But it is a big market share, there’s no question about it.”

Netflix’s winning bid surprised many in Hollywood. A rival bid from Paramount was viewed as more likely to receive regulatory approval because the company is backed by Larry Ellison, the multibillionaire co-founder of Oracle and a Trump supporter. 

Trump in October appeared to advocate for Paramount to win the Warner auction, telling reporters the Ellisons are “friends of mine”.

Sarandos, a Democrat whose wife served as an ambassador to the Bahamas during the Obama administration, has also visited Trump at Mar-a-Lago since he was re-elected last year. 

The Netflix-Warner deal is not expected to close until the third quarter of 2026 or later. It is subject to regulatory approval in the US and in Europe. 

The US president was asked about the deal as he prepared to host the Kennedy Center Honors, where he was scheduled to recognise Sylvester Stallone, Michael Crawford, Gloria Gaynor, George Strait and the rock band Kiss.

Jane Fonda is speaking out against Netflix‘s earthshaking move to acquire Warner Bros. Discovery, calling the $82.7 billion deal a “catastrophic” development that threatens to “destroy our creative industry.”

Fonda released her statement against the acquisition on Instagram through her Committee for the 1st Amendment organization. She wrote on Friday, “Today’s News that Warner Bros. Discovery has accepted a purchase bid is an alarming escalation of the consolidation that threatens the entire entertainment industry, the democratic public it serves and the First Amendment.”

She continued, “Make no mistake, this is not just a catastrophic business deal that could destroy our creative industry. It is a constitutional crisis exacerbated by the administration’s demonstrated disregard for the law.”

Directing her message to the powers that be, Fonda demanded the Justice Department and state regulators abstain from using their legal standing to “extract political concessions that influence content decisions or chill free speech.” In a sidebar to “Netflix and any company that becomes involved in this destructive deal,” Fonda wrote that it’s their “responsibility to defend our rights, not trade them away to pad your pockets. We know there will be enormous pressure to acquiesce, it is critical you stay strong.”

Hollywood at large has been mostly sour on the Netflix-Warner Bros. deal, with lawmakers, film producers and industry guilds alike all voicing concerns in the last week. Many expect the deal to cause seismic shifts in the entertainment industry, especially in the theatrical sector.

After months of deliberation, Netflix acquired Warner Bros. Discovery on Friday, outbidding David Ellison’s Paramount Skydance and Comcast. The cash and stock transaction is valued at $27.75 per share, and the deal is expected to close within 12-18 months, according to Netflix and WBD.

FT-Chicago Booth survey cites concern among officials about impact of weak jobs market and high prices on Americans

The Federal Reserve is set to cut interest rates next week despite deep divisions among its officials on the direction of the US economy, according to leading academic economists.

The rate-setting Federal Open Market Committee meets on Tuesday, with the vast majority of investors expecting the US central bank to lower US borrowing costs by a quarter point for the third meeting in a row the following day.

Most of the economists polled by the Chicago Booth Clark Center on behalf of the Financial Times agree with the markets’ view, with 85 per cent of the 40 respondents agreeing that the Fed will ease borrowing costs in response to fears the US labour market is weakening.

However, they think the committee will almost certainly be divided on a move that looks set to leave the US central bank’s benchmark federal funds target range at its lowest level in more than three years. This comes amid mounting concerns that ordinary Americans are facing affordability pressures due to higher costs.

FOMC members have spent the run-up to the final vote of 2025 debating whether to prioritise a weakening US labour market over an inflation rate that has been above the central bank’s 2 per cent goal since the spring of 2021.

Several regional Fed presidents have said they did not support the October cut but would be willing to back another one next week because of concerns that inflation in the dominant services sector was creeping up. This is at a time when the full impact of US President Donald Trump’s tariffs on the price of US imports is yet to be felt, they say.

New York Fed president John Williams signalled late last month that he and other leading members of the committee would back another quarter-point cut as insurance against a further slowdown in the US labour market.

Just one respondent to the FT-Chicago Booth poll said the 12 voting members of the FOMC would be able to overcome their differences and back a rate cut in unison. Sixty per cent of respondents thought there would be two dissents, with another third expecting three or more.

“If the rationale for the dissent is that they are missing their inflation target, then this can improve the credibility of the target,” said Stephen Cecchetti, a professor at Brandeis University. “At the same time, significant division — whether or not they vote against the decision — raises questions about the FOMC’s collective goals.”

There have not been more than two dissenting votes cast at an FOMC meeting since September 2019. The last time there were more than three was in 1992.

The most likely candidate to vote against a rate cut is Kansas City Fed president Jeff Schmid, who also dissented in October. Susan Collins, president of the Boston Fed, and Chicago’s Austan Goolsbee have indicated that they could join Schmid in voting against the consensus this time around.

Fed governor Michael Barr has also signalled he believes there is little room to lower borrowing costs. His counterpart on the board, Stephen Miran, will almost certainly call for a jumbo 50 basis point cut again.

Miran, a close ally of Trump, shares the US president’s desire for borrowing costs to fall rapidly.

After several strong years, many on the FOMC think the US labour market is beginning to cool. The latest Bureau of Labor Statistics report showed an unexpectedly high number of jobs were added to the world’s largest economy in September. But unemployment has edged up, and more recent private sector data shows US businesses are firing more workers.

Many respondents to the poll agreed with the FOMC’s hawks that the US central bank needed to focus more on the fight against inflation than maintaining a strong labour market.

Forty-eight per cent thought that controlling prices should be the priority, against 5 per cent who thought the focus should be on jobs. The rest wanted both sides of the Fed’s dual mandate to be given equal weight.

“I would prefer that the US drop the dual mandate in favour of one that solely focuses on inflation,” said Deborah Lucas, a professor at the Massachusetts Institute of Technology. “A direct link for a strong effect of monetary policy on employment has not been empirically well established.”

While hawks also point to relatively strong US growth, doves highlight that the US economy is heavily reliant on a boom in AI and AI-adjacent activity that has driven capital spending and helped prop up retail spending on the back of higher valuations for tech stocks.

The respondents were also asked what a 20 per cent drop in the value of the benchmark S&P 500 stock index would do to the US economy. A third said the subsequent fall in consumption and investment would trigger a US recession, while almost two-thirds said US growth would weaken, but not by enough to trigger a serious slowdown.