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Oracle has hit a patch of turbulence on its way to the cloud. That’s a buying opportunity for stock investors. The 40-year-old database specialist is following the path of other aging software players such as Adobe Systems, 34 years old; Autodesk, 35; andMicrosoft, 42.

All three started with dominant positions in software that was paid for in lump sums around major upgrades, and delivered on store shelves or directly to company network managers, often in disc form. Each has since shifted a big portion of sales to online, or cloud-based, programs—or at least to ones that are delivered digitally, upgraded frequently, and paid for with ongoing subscription fees. The result has been swelling stock valuations.

Oracle (ticker: ORCL) is a latecomer to the cloud, but its revenue from that business has been growing quickly from a small base, and shares have responded. The stock had jumped from $38 and change at the end of last year to nearly $53 earlier this month, when the company issued financial guidance, including for its cloud business, that left Wall Street wanting more. Shares declined 8% in a day.

At a recent $48, they look like a good deal. Oracle’s numbers suggest not only that its transformation continues apace, but also that its lucrative legacy business is stabilizing after two years of declines. That could lead to a quickening of overall profit growth. Shares could return 20% in a year.

THE VAST WEALTH of Oracle co-founder Larry Ellison—some $54 billion in Oracle stock alone—speaks to the company’s stunning success. An investor who bought in at the 1986 initial public offering has turned $1,000 into more than $800,000, versus $19,000 for the Standard & Poor’s 500 index, according to FactSet data.

Today, Oracle enjoys a dominant share in relational database-management software used to store and make sense of information, and a leading share in application servers, platforms that allow customers to make and run programs for things like human-resources work. About 80% of its revenue comes from software, the rest from hardware and services. In Oracle’s fiscal year ended in May, revenue grew 2%, to $37.9 billion, and earnings 3%, to $11.6 billion. Earnings per share rose 5%, to $2.74, helped by share repurchases.

Meager as that growth was, it was an improvement over the declines of the prior two fiscal years, as relatively young players in software and networking galloped ahead in markets that rub up against Oracle’s. Amazon.com (AMZN) is the runaway leader in what is called infrastructure-as-a-service, whereby customers can pay as they go for computing power, storage, and software tools.

Salesforce.com (CRM) could top $10 billion in revenue this year selling software-as-a-service, specifically online tools for managing salespeople, customer support, and more. There is a third category, called platform-as-a-service, that is more up for grabs.

The terms are murky, but one thing seems clear: Nearly everyone has a head start on Oracle in the cloud. Perhaps that’s because Oracle has had it so good for so long. Even now, the company turns 80 cents of each sales dollar into gross profit, which is more than double Apple’s (AAPL) margin.

In fact, Oracle may not have been caught as flat-footed by the cloud as it seems. It has spent more than a decade rewriting its source code to allow for online, subscription-based delivery of popular products. Over the past three years, it has spent more than $17 billion on research and development. One focus has been building up artificial-intelligence and machine-learning capabilities in its database software, improvements that can pay off no matter where the software resides.

More recently, Oracle has joined Microsoft (MSFT) and Alphabet (GOOGL) in a race to build big data centers to compete more effectively with Amazon Web Services. Competition is fierce, but Oracle holds a key advantage in the form of its existing base of 400,000 customers worldwide. Many of its competitors have spent years perfecting custom software, or heavily modifying off-the-shelf software, and they are loath to upend things by switching to a totally new computing environment.

The experience of another cloud latecomer bodes well for Oracle. Microsoft launched its Azure cloud platform in 2010. Today, Microsoft’s cloud businesses, including Office 365, rival Amazon Web Services for yearly revenue by some estimates. On Wall Street, that transformation has turned Microsoft from a has-been to a darling. Five years ago, its shares fetched just 10 times projected earnings. They recently changed hands at more than 23 times. Shareholders have made 22% a year, compounded, over that span, versus 14% for the Standard & Poor’s 500 index.

Oracle, too, has seen its valuation rise over the past five years, from 12 times earnings to 16, but that mostly reflects a broad market that is becoming more expensive. The stock appeared to be having a breakout performance this year until Sept. 15, a day after Oracle reported financial results for its fiscal first quarter. Earnings and revenue beat estimates, and cloud revenue jumped 51% from a year ago, to $1.5 billion.

That was slower than last quarter’s 58% cloud growth, however, and Oracle predicted 39% to 43% cloud growth in constant currency during its current quarter, which runs through November.

BUT THEN, PREVIOUS QUARTERS got a boost from Oracle’s purchase of cloud-software concern NetSuite, which closed in November 2016. Cloud revenue, now about 16% of total revenue, could reach 25% by the end of the decade—and bring rising profit margins.

Meanwhile, much of Oracle’s upside during the quarter came from better-than-expected sales of traditional on-premises software licenses and support.

“We believe that enterprises have gained a better understanding of the pros and cons of the public cloud (that it isn’t well suited today for many workloads for cost and control reasons),” writes William Blair analyst Jason Ader. That understanding “appears to be driving a resurgence in spending on private cloud and on-premises infrastructure software across the industry.” He notes also that Microsoft, VMware (VMW), and Red Hat (RHT) have experienced similar trends.

For now, analysts predict Oracle’s earnings-per-share growth will quicken to 7% this year and 8% next year. A rise to $57 over the next year would leave the stock priced in line with the broad market, at 18 times projected earnings. Shares yield 1.6%.

After decades of research and development, gene therapy is rapidly emerging as one of the most exciting areas in biotechnology—and generating new hope for patients with certain rare and often deadly inherited diseases. Replacement gene therapy that uses neutered viruses to deliver healthy genes to the body is particularly promising, given its potential to cure a range of disorders with the administration of a single treatment.

The first regulatory approval for this technology could come as soon as January, if the Food and Drug Administration gives the go-ahead to Spark Therapeutics (ticker: ONCE) for its one-time treatment that targets a rare, inherited retinal condition leading to blindness.

Other approvals could follow, igniting even greater interest in the field—and in the shares of several biotech companies making impressive headway in clinical trials

The enthusiasm for these treatments was evident in April among neurologists attending an industry conference in Boston. The group broke into applause after viewing a video about the remarkable results of a small clinical trial of an AveXis (AVXS) treatment for infants with a particularly severe form of spinal muscular atrophy, or SMA. All nine children who were dosed for at least 20 months were still alive, compared with the 8% of untreated children who typically would be alive by this point without major breathing support. Moreover, patients in the trial were hitting milestones, such as sitting unaided, that rarely occur with SMA.

AveXis’ gene therapy probably has gotten the most attention, but other replacement-gene-therapy companies, including Spark Therapeutics, Regenxbio (RGNX), Audentes Therapeutics (BOLD), and Voyager Therapeutics (VYGR), also are making strides in pursuing treatments for various diseases, including hemophilia and Crigler-Najjar syndrome, which afflicts a handful of newborns each year in the U.S. Gene therapy treatments likewise are being developed to alleviate conditions without a direct genetic link, such as Parkinson’s disease and age-related wet macular degeneration.

“Gene therapy will be a paradigm shift in drug discovery,” says Rick Schottenfeld, chairman of the Schottenfeld Group, a New York–based investment manager that holds Regenxbio shares.

THE GOAL OF REPLACEMENT gene therapy is to replace faulty genes with normal ones, in the hope of producing significant benefits or even cures. The process involves packaging healthy genes into neutered viruses, usually relatively harmless adeno-associated viruses, which then act as vectors delivered in a single dose either into the bloodstream or the area where the disease is manifest. The neutered viruses are designed to attach to targeted cells and deliver the new genes into the nucleus of the cells, along with so-called promoters that help prompt the new genes to direct cells to make critical proteins that are otherwise lacking or ineffective.

The most attractive targets are monogenic diseases, such as SMA, which are caused by a mutation on a single gene that prevents production of a vital protein. Many of the diseases lack effective treatments.

Neurologists aren’t alone in cheering the promise of this therapy. On Wall Street, the combined market value of a group of replacement-gene-therapy companies tracked by Chardan, a New York investment bank, has risen more than 70% this year, to about $8.7 billion. Yet stocks such as Regenxbio, a leader in developing viral delivery mechanisms, could have considerably more upside, as could AveXis and Spark. “From an investment point of view, there is tremendous promise over the next five to 10 years,” says Marshall Gordon, senior research analyst for health care at ClearBridge Investments. “We’re near the beginning of what could be a long line of clinical successes.”

Josh Schimmer, an analyst at Evercore ISI who began coverage of six gene therapy stocks last month, agrees. “There is a sea of unmet medical needs in gene-specific diseases that can be treated with gene therapy,” he says. “The power of this platform is potentially enormous and is just getting started.”

One positive for gene therapy, Schimmer says, is that the approval body within the FDA is the Center for Biologics Evaluation and Research, which has been more lenient than the agency’s larger Center for Drug Evaluation and Research in approving testing protocols and treatments. For example, AveXis got the go-ahead to study approximately 20 patients in its pivotal Phase 3 SMA trial (the final treatment trial) without an untreated control group. The company has been talking to the FDA about the possibility of an accelerated approval of its treatment, which could put it on the market next year.

Another bullish development for the technology and the stocks is the growing interest of big drug companies such as Pfizer (PFE) in gene therapy, both to hedge the potential disruption of existing treatments for diseases like hemophilia and to take advantage of the commercial opportunity. That could lead to takeovers of some smaller gene therapy companies. Pfizer vowed to become a “leader” in gene therapy after its purchase last year of privately held Bamboo Therapeutics.

Yet investing in pure-play gene therapy stocks also carries considerable risk, as the companies anticipate varying degrees of success. They tend to have little or no current revenue and are burning through their cash, raised via equity offerings that could continue until treatments are commercialized. If the treatments don’t get to market, the stocks could fall sharply.

A big issue for the industry and investors will be gene therapy pricing. At a time when treatments for rare diseases that need to be dosed indefinitely can cost $400,000 annually or more, how should a potential one-time cure be priced? Gene therapy companies haven’t said yet how they plan to price treatments, and Wall Street analysts and investors have said price tags of anywhere from $1 million to $4 million per patient for serious diseases could be justified when there are no alternatives—or when less effective alternative treatments cost more over time.

The current treatment for spinal muscular atrophy, Biogen’s (BIIB) Spinraza, was approved by the FDA last year. It costs $750,000 for the first year’s treatment and $375,000 a year thereafter. AveXis’ treatment looks equal or superior to Spinraza based on an admittedly small trial, and its administration is superior: a one-hour, one-time intravenous infusion, versus an injection into the spinal column. A pay-for-performance model might develop, with annual payments based on continued success, but that raises issues of portability. If a patient changes jobs and health insurers, will the new insurer be forced to pick up the annual payments agreed to by the former insurer?

“There has to be a conversation,” says Matthew Patterson, CEO of Audentes, which is working on treatments for several rare diseases. “The last thing that we want to see happen is to solve incredible scientific challenges and [fail to] figure out a way to get patients access to them.”

REPLACEMENT GENE THERAPY using modified viral vectors is just one of several such approaches now under development. So-called CAR T-cell cancer treatments, including a Novartis (NVS) treatment that won FDA approval this past summer, involve genetically re-engineering cells in the immune system to fight cancer. Crispr gene-editing technology has also generated headlines; it aims to edit out a serious disease-causing genetic mutation. Despite the excitement, however, most Crispr companies have yet to test their treatments in humans.

In initiating coverage of a range of biotech companies recently, Barclays analyst Gena Wang wrote that “while significant advances have been made in recent years, gene-editing technologies are still in their infancy, and we see several key challenges ahead before they are ready for prime time.” These include “safe delivery of the gene-editing therapies, and evidence of stable and long-lasting corrected cells,” she added.

Researchers have been refining replacement gene therapy using viral vectors for the past two decades. It is considered a safer technique than Crispr. The new genes aren’t designed to integrate with the patient’s DNA and thus aren’t passed on when cells divide. This differs from Crispr gene editing, in which new DNA often is inserted directly in a patient’s genes using a cut-and-paste method. Replacement gene therapy reduces the chances of a potentially harmful off-target genetic insertion that could lead to cancer. But there are risks, including a possible immune-system response to the vectors. One of the most serious incidents occurred in 1999, when an 18-year-old patient receiving experimental replacement gene therapy died from a severe immune response.

The therapy has advanced as better viral carriers have been developed to get the normal genes to targeted areas of the body, including the liver, eye, and central nervous system. That’s important because the greater the targeting success, the greater the production of missing or deficient proteins. Some diseases, such as hemophilia, can be treated effectively in patients with only a fraction of the normal protein levels. (The missing or defective blood-clotting proteins among hemophiliacs are known as Factors VIII and IX.)

STILL, MANY QUESTIONS REMAIN, including whether success in small clinical trials can be replicated in larger numbers of patients. Many investors are used to clinical trials that involve hundreds and even thousands of patients to demonstrate a drug’s effectiveness. By comparison, the initial AveXis trial enrolled just 15 infants with SMA.

“The thing about gene therapy is that because the results are so dramatic, you don’t need many patients to show a drug is working,” says Gbola Amusa, head of health-care research at Chardan. And with rare diseases, there are a limited number of patients to study.

Whether the treatments will prove effective over multiple years, or a lifetime, remains to be seen. Gene therapy has been effective for as long as seven years in humans, offering the hope of longevity. “The potential to cure disease is the Holy Grail of medicine,” says Amusa. “Traditional therapies often have a limited impact on patients. Gene therapy has the potential to turn a two-year life expectancy for an SMA 1 patient into 70 years.” (SMA 1 is a severe form of spinal muscular atrophy.)

If these treatments ultimately stop working, it might be difficult to re-treat patients with the same therapy because their bodies probably will have developed immunity to the viral vectors that initially delivered new genes. That means the viruses probably would be attacked by the patient’s immune system. Some companies are working on ways to address this issue, such as using different viral vectors.

A single dose of a gene therapy can involve trillions of viruses. Getting consistent manufacturing quality is a keen concern of drug regulators. The industry’s view is that manufacturing techniques are advancing and should be up to the job if treatments are approved.

Hemophilia is one of the biggest targets for gene therapy, as it afflicts about 20,000 people in the U.S. An estimated $5 billion to $10 billion is spent annually to treat the disease, much of it on replacement blood-clotting factor. BioMarin Pharmaceutical(BMRN), Spark, and Sangamo Therapeutics (SGMO), in partnership with Pfizer, are developing gene therapy treatments for hemophilia A, the most common form of the disease. Spark (also partnering with Pfizer), uniQure (QURE), and Sangamo are targeting hemophilia B.

Hemophiliacs generally need regular infusions of blood-clotting factor to control bleeding, which can run to $400,000 per patient annually. And even with the clotting factor, they can be subject to bleeds, including debilitating bleeding in joints. Many hemophiliacs, including children, probably wouldn’t be eligible for gene therapy, and others might feel little need to switch from currently effective therapies. Still, the gene therapy market could be large, especially if the treatments result in steady levels of the clotting factor for an extended period of time.

CHOOSING AMONG THE SHARES of companies developing replacement gene therapy is challenging, as each company has different strengths, and none has traditional financial metrics on which to be judged. Amusa, the Chardan analyst, favors Regenxbio, calling it “the best way to broadly play the emergence of vector-based gene therapy.” The company, based in Rockville, Md., is licensing viral vectors to about 10 partners, including AveXis and Audentes, and will get royalties estimated at about 10% if those treatments are commercialized. Regenxbio also has several internally developed treatments. The breadth of its initiatives makes it the closest thing to a gene therapy mutual fund.

Amusa has an aggressive $75 price target on Regenxbio, compared with its recent price of $29, based on its platform and what he views as multiple potential catalysts. These include AveXis’ SMA treatment and Regenxbio’s own treatment for age-related macular degeneration.

Shares have risen about 40% recently amid greater enthusiasm for the company’s internal drug candidates, including its treatment for macular degeneration, a potentially large market with more than a million patients in the U.S. Regenxbio’s treatment is designed to produce an antibody, a form of protein, that inhibits the formation of leaky blood vessels near the retina that harm vision. It is designed as a therapeutic agent, not a cure, and a replacement for current wet-macular-degeneration drugs like Eylea that need to be injected into the eye.

Regenxbio is due to report initial results for its macular degeneration trial by the end of 2017, and also trial results involving a gene therapy treatment for homozygous familial hypercholesterolemia, or HoFH, a rare inherited disease that leads to ultrahigh cholesterol levels and often results in the death of patients in their 30s and 40s. The company also plans to start a clinical trial in 2018 for a treatment for mucopolysaccharidosis type 1, or MPS 1, a rare metabolic disorder that usually leads to death by age 10.

“We want to be a leader in the development of gene therapy treatments through both internally developed candidates as well as our partnerships,” says Regenxbio chief executive Kenneth Mills. “By the middle of next year, we expect to have the broadest and deepest pipeline of product candidates in clinical development,” he adds.

AVEXIS HAS HAD A BIG RUN, with shares doubling this year to $97. Bullish investors expect the company to seek and possibly win accelerated approval for its SMA treatment based on its Phase 1 trial. AveXis is expected to announce later this year whether the FDA will consider accelerated approval. There are an estimated 300 to 400 babies born in the U.S. each year with SMA 1, the most common genetic cause of infant mortality.

The consensus is that the FDA will want to see results of a pivotal Phase 3 trial set to begin in the current quarter before weighing approval, probably in 2019 or 2020. One factor in favor of a delay is the availability of the Biogen drug. Still, the Street might be underestimating the potential for accelerated approval, given the impressive early-stage trial results and evidence of regulators’ increased flexibility.

Amusa lifted his price target on AveXis to $135 last month from $102.50 while maintaining a Buy rating, based on the company’s move to broaden its market opportunity by tackling SMA 2. That is a less severe form of the disease, but one that often leads to the death of patients in their 20s. AveXis is dependent on its SMA treatment. If it hits unexpected roadblocks and doesn’t get FDA approval, the stock could collapse.

Spark is expected to get approval for its retinal gene therapy for a condition known as RPE65-mediated inherited retinal disease, but the condition is rare, affecting perhaps 1,000 to 2,000 people in the U.S. Spark probably needs success in a larger market—hemophilia A—to justify its $3 billion market value. It has generated impressive clinical trial results with a hemophilia B treatment, partnering with Pfizer. However, Pfizer gets the bulk of any profits. Spark has full ownership of its hemophilia A treatment.

Spark so far has released limited data from its Phase 1/2 hemophilia A trial, with information on just three patients. The news is encouraging, showing consistent levels of Factor VIII in patients’ blood after receipt of the therapy.

“We look for companies where we see platforms that can generate serial successes and not just a single product,” says ClearBridge’s Gordon. “Spark has one of those platforms.”

BioMarin—a large biotech company with several commercialized drugs—is ahead in developing a hemophilia A gene therapy, but one of its clinical-trial results showed a wider range of Factor VIII levels, potentially giving Spark an edge.

Wang, the Barclays analyst, began coverage of Spark earlier this month with an Overweight rating and a $104 price target, against a recent price of $87. “Despite increasing competition, Spark’s hemophilia A and B programs demonstrate the likely potential to achieve best-in-class profiles,” she wrote, noting that success in hemophilia A “appears only partially priced in” to the stock.

AUDENTES THERAPEUTICS is targeting two deadly ultrarare genetic diseases—X-linked myotubular myopathy, or XLMTM, and Crigler-Najjar syndrome—and expects to have initial reads from its Phase 1/2 trial later this year. It also is developing a treatment for Pompe disease, another rare disorder, that could begin a clinical trial next year.

Audentes shares have moved up sharply in recent months to $27 from $14, giving the company a market value of $760 million. CEO Patterson says the rally might reflect investor excitement as the company begins clinical trials. He notes that the treatments for XLMTM, a neuromuscular disorder that is usually fatal by age 3, and Crigler-Najjar, which prevents the breakdown of bilirubin, are designed to express the needed proteins only in targeted places—the skeletal muscles and liver, respectively. Bilirubin is produced from the natural breakdown of red blood cells.

Voyager Therapeutics’ lead treatment is for Parkinson’s. It aims to treat the progressive nerve disease by stimulating production of an enzyme that helps the brain synthesize dopamine, a process that gets badly impaired in the later stages of the disease. It is administered through brain surgery and differs from other gene therapies that seek to provide a cure.

Voyager reported encouraging Phase 1 trial results earlier this month that showed clinical benefits in patients with advanced disease. It plans to move the treatment to a pivotal Phase 2/3 treatment later this year. Evercore ISI’s Schimmer has been bullish on Voyager, whose shares doubled to $17 in the wake of the Parkinson’s news, given the high unmet needs of patients with the advanced disease. In a client note after the Voyager news, Schimmer reiterated an Outperform rating and $21 price target, writing that “our leading candidates for the ‘next big thing in gene therapy’ are Voyager, Regenxbio, and Audentes.” Private companies also are active in replacement gene therapy, including Agilis Biotherapeutics and Solid Biosciences.

As one of the most promising areas of biotechnology, gene therapy might bring significant benefit or even cures to patients with a range of serious genetic disorders, and alleviate diseases such as Parkinson’s and macular degeneration. Given the potential, both near and long term, investors might want to gain exposure through stocks such as AveXis, Regenxbio, and Spark Therapeutics.

Matthieu Duncan upbeat about domestic labour reforms and expansion beyond France

Early September is traditionally a bleak period for the French. This year, the misery of la rentrée — the return to office life after the long August holiday — was compounded by growing disenchantment with their new president.

But such gloom eludes Matthieu Duncan. He is chief executive of Natixis Asset Management, one of the country’s biggest fund houses, with €368bn of assets under management at the end of June.

“We are pretty optimistic,” he says when describing the post-election landscape in France and the performance of Emmanuel Macron, the 39-year-old who had never held elected office before. “It’s still early days, but [he] is off to a decent start.”

With investors having held their breath after Mr Macron went head to head in the final round against Marine Le Pen, the Eurosceptic leader of the far-right National Front, he describes the president’s victory in May as “a pretty important psychological turning point”.

Perhaps the sunny outlook can be attributed to his American heritage, but two months ago Mr Duncan’s mood was considerably less sanguine.

In July Natixis AM was fined a record €35m by the French markets regulator for overcharging investors in connection with its formula funds, a type of structured product that guarantees the capital invested in addition to a return determined by a mathematical formula.

The Autorité des Marchés Financiers said Natixis had breached its professional obligations in the management of the funds between 2012 and 2015. The watchdog claimed it had identified several failings in connection with redemption fees.

Mr Duncan, who denies there had been any detriment to clients, immediately hit back, saying the company would appeal against the “unjustified and disproportionate” decision. Arguing there was a lack of guidance over how such funds should be governed, he said the company would fight the decision in the French supreme court.

A few weeks on, fresh off the Eurostar train from Paris and sitting in an office of parent group Natixis Global Asset Management overlooking St Paul’s Cathedral, his tone appears to have softened. He states that the company is “considering” and “likely” to appeal, though he says their position has not changed.

The affair has not altered his belief that Paris has much to offer asset managers. He says it is not well known that the city is Europe’s second-largest centre for the asset management industry after London. Around 650 companies have a presence there.

Although Frankfurt may be more successful than Paris, Dublin and Madrid in persuading banks to siphon staff out of London as part of their Brexit planning, he is optimistic the French capital can strengthen its appeal.

“There is a clear willingness [by the authorities] to highlight the attractiveness of Paris as a financial centre. My personal view is, that for them to really have a chance of material change, you need labour and fiscal reform,” he says. “The government is announcing changes on both these fronts.”

Raised and educated largely in the US, working in France has made him aware of another potential advantage. “The French education system is very strong on quantitative and analytical skills. I think the asset management industry is moving towards that approach,” says Mr Duncan, whose accent is faintly American with the odd French inflection.

The role at Natixis technically marks the second occasion he has been immersed in a Parisian workplace, given a previous role as co-head of Goldman Sachs’s Paris office. Joining from Quilter Cheviot Investment Management, he took the helm in April last year with a mandate to expand the business beyond its home market.

His business sits within a sprawling group whose structure can be confusing to outsiders. BPCE, the French bank, owns 70 per cent of Natixis, the French financial services group. Natixis’ eponymous asset management unit, Natixis Global Asset Management, is a holding group with more than 20 affiliates, of which Natixis AM is the largest by assets. Its services are distributed solely through Natixis GAM.

Natixis GAM is run by Jean Raby, a dual Canadian and French citizen who also worked at Goldman Sachs. He and Mr Duncan crossed paths at the bank but do not know each other well.

While Mr Raby is in acquisition mode, having recently signalled his desire to expand in Asia, Mr Duncan wants to beef up Natixis AM’s capabilities in the US and Singapore, where it already has small offices, to be closer to clients and to expand its emerging markets equity business. “Those two businesses are beachheads,” he says. “We have portfolio managers and research analysts on the ground.”

But the plan is to expand “in a progressive way” rather than doing “a big bang”.

Natixis AM has tended to favour gradual change. Twenty years ago the business was focused almost exclusively on French assets, then the introduction of the euro tilted the business towards the rest of continental Europe. Around 70 per cent of the business is focused on fixed income products.

Closer to home, uncertainties remain. The triple risks of Brexit, reforms not materialising in France and Mifid II, a set of sweeping regulations that come into force in January, are all on the horizon. As we spoke, the CGT union, France’s second largest, was gearing up for large-scale protests regarding labour reform measures.

“It is par for the course in France,” says Mr Duncan.

Brexit is brushed aside less easily. “Everyone’s a bit unsettled,” he says, highlighting that asset managers based on the continent are as concerned as their UK-based counterparts about market access. “There is a lot of discussion about what the post-Brexit investment management landscape is going to look like.”

Natixis AM has also not made the final decision on whether it will stop charging investors for analyst research. Mifid II will end the system of fund managers receiving external analyst research for free in return for placing trades with banks and brokers. Natixis AM says discussions continue with its research providers.

But for now, buoyed by the freshness of the chief executive role, Mr Duncan remains upbeat. Natixis AM is well known in France but less so internationally, he says. “Part of my mandate is to help change that.”

The key drivers for the decision to downgrade the UK's ratings to Aa2 are as follows: 

Facebook Abandons Plans to Change Share Structure, Avoiding Lawsuit

Reversal is the latest about-face for the social media giant as it fends off controversies on several fronts; CEO Mark Zuckerberg says he plans to accelerate sale of shares

Facebook Inc. on Friday abruptly abandoned a plan to change its stock structure that would have given Chief Executive Mark Zuckerberg more control, the latest in a string of reversals by the social-media giant as it fends off controversies on several fronts.

The about-face heads off a public trial scheduled to start next week for a lawsuit filed against Facebook by shareholders who claimed that conflicts of interest and other behind-the-scenes discussions tainted a board decision to approve the creation of a new class of shares.

The share restructuring was aimed at ensuring Mr. Zuckerberg’s continued control of Facebook even as he planned to give away 99% of his family’s wealth over his lifetime.

Mr. Zuckerberg had been scheduled to take the stand in that trial at Delaware’s Chancery Court on Tuesday, in a hearing that was due to be open to the public.

A lawyer for the plaintiffs, Stuart Grant, said he expects the case to now be dismissed. Facebook’s decision is “all the relief we asked for,” Mr. Grant said. “It’s a complete win.”

The reversal fits an increasingly common pattern for Facebook, which has repeatedly had to alter its position in the wake of public criticism over how it manages its powerful global platform. On Thursday, Mr. Zuckerberg said Facebook would provide congressional investigators with details of 3,000 ads bought by Russians during the U.S. presidential election, responding to pressure from lawmakers and others that it wasn’t forthcoming enough about how foreign entities used its platform to influence political discourse during the election.

That came after Facebook Chief Operating Officer Sheryl Sandberg this week said the company is adding more human reviewers to oversee its ad-targeting system after a report showed it was possible for advertisers to target ads to users interested in anti-Semitic and other hateful topics.

And Mr. Zuckerberg was initially dismissive of concerns about the proliferation of false and misleading news spread on Facebook during the U.S. presidential campaign last year—only to reverse himself and announce measures to try to curb such misinformation.

Mr. Zuckerberg, whose fortune is estimated at $71 billion, said he doesn’t need the change in shareholding structure because Facebook’s stock has risen so much that he can fund his for-profit philanthropic organization, the Chan Zuckerberg Initiative, for at least 20 years by selling his existing stock without losing control.

Facebook shares have risen more than 50% since April 2016, when the plan was first announced.

Mr. Zuckerberg acknowledged that his plan to change from a two-class to a three-class share structure “was going to be complicated and it wasn’t a perfect solution. Today I think we have a better one.”

In a blog post, Mr. Zuckerberg said he plans to accelerate the sale of shares to fund the Chan Zuckerberg Initiative, an entity that allows him to donate to charitable causes and invest in companies that further a global mission.

Limiting Mr. Zuckerberg’s ability to gain more control over Facebook goes against the tightening grip other tech founders have exerted on their companies. Google, now Alphabet Inc., started issuing a third class of nonvoting shares in 2014. Google was sued over the decision, ultimately settling with investors.

Snap Inc. only issued nonvoting shares when it went public earlier this year because its founders wanted to stay in control for the long-term.

“The fact that shareholders do have the right to sue does limit CEO power,” said Jay Ritter, a finance professor at the University of Florida.

Mr. Ritter said the only other technology companies he’s aware of with a three-class share structure similar to what Facebook was seeking are Alphabet and Snap.

Mr. Zuckerberg holds about 59.7% of the voting control of Facebook because he controls 86% of the company’s Class B shares, which have 10 times the voting power of Class A shares. Every Class B share he sells is automatically converted to a Class A share, which gets just one vote.

He said Friday he now expects to sell between 35 million and 75 million shares over the next 18 months “to fund our work in education, science, and advocacy.” At Facebook’s current stock price, that amounts to between $6 billion and nearly $13 billion.

The lawsuit filed by shareholders last year said Facebook’s board showed “stunning” disloyalty in rubber-stamping Mr. Zuckerberg’s proposal to issue nonvoting shares to help him keep control of the company. The plan would have limited shareholders’ say and cemented Mr. Zuckerberg’s control regardless of whether he was financially invested in the company’s success, investors in the lawsuit said.

For example, longtime Facebook director Marc Andreessen, who served on a special committee created to discuss the new share structure, was privately coaching Mr. Zuckerberg by text message on how to win over the other two directors on the committee, according to text messages disclosed in court documents last year.

In one instance, Mr. Andreessen texted Mr. Zuckerberg during a March meeting of the special committee with progress reports. “NOW WE’RE COOKING WITH GAS,” Mr. Andreessen wrote.

A spokeswoman for Mr. Andreessen declined to comment.

Andrew Winden, a fellow at Stanford Law School, said Facebook likely withdrew the capital-restructuring plan in anticipation of losing the case. “Those communications with Andreessen really messed up the quality of [Facebook’s] special committee process,” he said. “They created a hurdle that was just so high.”

Mr. Grant, the plaintiffs’ lead counsel, said he received a call from Facebook attorneys Thursday night informing him that the company had withdrawn the capital-restructuring plan at the heart of the case.

An administrator for the Delaware Chancery Court sent an email Friday afternoon saying the trial was “canceled due to a settlement.” Mr. Grant said that is incorrect, and that he plans to file a stipulation Monday to officially withdraw the lawsuit because the reason for it no longer exists.