FT : The probe gripping Italy’s banking industry

The probe gripping Italy’s banking industry

The insurer at the heart of the deal upending Italian finance

The bank takeover that has gripped Italy’s finance sector this year was orchestrated by a secret alliance going after a stealth target, prosecutors are alleging.

DD readers are familiar with the back story. In January the state-backed bank Monte dei Paschi di Siena (MPS) launched the takeover of rival lender Mediobanca, shocking markets and analysts. 

The €17bn acquisition was finalised in September. But the saga didn’t end there.

Last week the FT reported that Italian prosecutors were investigating MPS boss Luigi Lovaglio and top shareholders for alleged market manipulation and obstruction of supervisory functions in connection with the takeover. Now, a search and seizure warrant seen by the FT casts the takeover in a new light. 

According to prosecutors, MPS’s real target was not Mediobanca, but the insurer in which Mediobanca is the largest shareholder: Generali. 

The warrant alleges that Lovaglio and billionaire investors conspired to execute the takeover with Generali as the ultimate prize.

Generali is one of the largest holders of Italian sovereign debt, making it a crucial player in the country’s financial services industry.

The insurer’s chief executive, Philippe Donnet, has been a longtime target of billionaire investors Francesco Gaetano Caltagirone and the Del Vecchio family, which runs the eyewear giant Luxottica and the holding company Delfin. Both are major investors in Generali and acquired substantial stakes in MPS over the past year.

Prosecutors are alleging they used MPS as a vehicle to execute a broader plan to seize control of Generali without launching a costly full-blown takeover.

They allege Caltagirone, along with Delfin, co-ordinated efforts and investment decisions for years without informing the market or regulators, ultimately enlisting MPS chief executive Lovaglio to execute their plan.

Lovaglio, Delfin and Caltagirone have always denied the takeover of Mediobanca was a strategy to install a friendly chief executive at Generali.

MPS said it was “confident it can provide all the necessary information to clarify the correctness of its actions” and is co-operating with authorities.

Yet the probe could make it more difficult for investors to oust Donnet ahead of the end of his term in 2027, and could also complicate MPS’s integration of Mediobanca. 

FT : EU can produce twice as many electric cars as needed, says study

EU can produce twice as many electric cars as needed, says study

Slow drive
Investment in electric car production has slowed in Europe, partly because there is already the capacity to build twice as many EVs as there is demand for, according to a new report seen by Alice Hancock.

Context: Brussels is gearing up to present a series of proposals on December 10 aimed at bolstering the bloc’s flagging industry and reviewing its ambitious plan to phase out internal combustion engines by 2035.

The combustion engine ban in particular has become a political lightning rod and its review may yet be delayed amid deep divisions between member states and within the commission, according to people close to the talks.

Brussels-based think-tank Bruegel has run the numbers on clean tech investment in Europe. Its new Clean Investment Monitor published today finds that investment in electric vehicle plants grew rapidly up until the beginning of 2024, but has declined since.

Part of the reason for that is that existing factories are already producing 200 per cent of the total demand for EVs in the EU, with a total capacity to produce about 4.6mn EVs.

Germany is home to the highest capacity of all member states, helped by a €5.8bn Tesla facility opened in 2022.

Bruegel’s tracker, which monitors facility-level data to work out real-time investment in the EU, found that Spain and Hungary were attracting the most clean tech investment, despite Hungary’s naysaying on climate policy.

Both have brought in significant amounts of Chinese investment relative to other member states. The Chinese battery maker CATL, for example, is currently building a €7bn facility in Hungary and a €4bn plant in Spain developed through a joint venture with Stellantis.

Previously the majority of investment into battery supply chains in Europe came from South Korean companies such as LG Energy and Samsung.

“While industrial-policy debates in Europe tend to focus on how best to support manufacturing projects, the EV case illustrates the equally important need to strengthen demand-side measures,” said Simone Tagliapietra, senior fellow at Bruegel.

“This means better co-ordinated EV purchase-subsidy schemes across Europe and avoiding market confusion by watering down key provisions such as the 2035 combustion engine ban,” he added.

Tagliapietra also noted that “squeezed between Chinese competition and US tariffs, European carmakers are unlikely to be able to rely on exports for relief”.

The Information : OpenAI CEO Declares ‘Code Red’ to Combat Threats to ChatGPT, D

OpenAI CEO Declares ‘Code Red’ to Combat Threats to ChatGPT, Delays Ads Effort

The Takeaway
  • OpenAI CEO Sam Altman declares ‘code red’ to improve ChatGPT.
  • The company is preparing to release a new reasoning model that scores well against Google’s Gemini 3
  • The code red also involves making improvements to OpenAI’s image-generating AI

OpenAI CEO Sam Altman on Monday told employees he was declaring a “code red” to marshall more resources to improve ChatGPT as threats rise from Google and other artificial intelligence competitors, according to an internal memo.

As a result, OpenAI plans to delay other initiatives, such as advertising, Altman said.

“We are at a critical time for ChatGPT,” he said.

OpenAI hasn’t publicly acknowledged it is working on selling ads, but it is testing different types of ads, including those related to online shopping, according to a person with knowledge of its plans. Millions of people already use ChatGPT to search for products to buy.

Altman said the code red “surge” to improve ChatGPT meant OpenAI would also delay progress with other products such as AI agents, which aim to automate tasks related to shopping and health, and Pulse, which generates personalized reports for ChatGPT users to read each morning.

He didn’t specify what was going wrong with ChatGPT, but Google said this fall that its Gemini chatbot had gained ground in terms of usage. Altman recently warned employees privately that Google’s AI resurgence could cause “temporary economic headwinds” for OpenAI.

In a call with OpenAI investors last month, CFO Sarah Friar alluded to a slowdown in ChatGPT growth, though it wasn’t clear what growth metric she was referring to, according to a person with knowledge of her remarks.

ChatGPT’s performance will impact OpenAI’s ability to raise another $100 billion or so to weather the significant cash burn the company has projected. The company projected this summer that while it burns tens of billions of dollars to develop new technologies and power ChatGPT and other products in the coming years, the chatbot will generate about $10 billion in revenue this year from subscriptions, $20 billion next year and roughly $35 billion in 2027. (It launched just three years ago.)

OpenAI’s code red represents a role reversal from three years ago, when Google began its own “code red” to respond to the threat ChatGPT posed to Google Search. Google later launched its Gemini chatbot, which still lags OpenAI in terms of user numbers, but there are signs it may be catching up. Google said in October that Gemini has 650 million monthly active users, up from 450 million monthly active users in July, though it’s still a far cry from the user figures OpenAI has disclosed for ChatGPT.

Google also has launched “AI mode” in Google Search, which essentially turns the search app into a chatbot akin to ChatGPT.

For its part, OpenAI estimates ChatGPT handles 70% of the world’s AI “assistant activity” and 10% of “search activity,” ChatGPT leader Nick Turley said in an X post Monday night.

Altman said Monday in an internal Slack memo that he was directing more employees to focus on improving features of ChatGPT, such as personalizing the chatbot for the more than 800 million people who use it weekly, including letting each of those people customize the way it interacts with them.

Altman also said other key priorities covered by the code red included Imagegen, the image-generating AI that allows ChatGPT users to create anything from interior-design mockups to turning real-life photos into animated ones. Last month, Google released its own image generation model, Nano Banana Pro, to strong reviews.

Altman said other priorities consisted of improving “model behavior” so that people prefer the AI models that powers ChatGPT more than models from competitors, including in public rankings such as LMArena; boosting ChatGPT’s speed and reliability; and minimizing overrefusals, a term that refers to when the chatbot refuses to answer a benign question.

Altman’s code-red declaration comes as new models from competitors including Google and Anthropic have been met with especially strong praise from app developers.

Altman said OpenAI is planning to ship a new reasoning model next week that is “ahead of [Google’s] Gemini 3” in OpenAI’s internal evaluations but the company had more work to do on improving the ChatGPT “experience.” Reasoning models spend more computing power to produce better answers, powering ChatGPT’s Thinking mode and features such as Deep Research.

An OpenAI spokesperson did not immediately have a comment.

>>> Skew Monitor : AXA, BMW, Iberdrola, Prosus, Santander, Siemens Energy

  • Biggest skew gainers:
    • Iberdrola skew up 1.2 point to 6.3, in the 88th percentile; stock fell 0.3% w/w; RSI: 57
    • Ahold Delhaize skew up 0.8 point to 6.8, in the 70th percentile; stock rose 1.8% w/w; RSI: 53
    • BMW skew up 0.6 point to 4.8, in the 44th percentile; stock rose 2.7% w/w; RSI: 64
    • Prosus skew up 0.3 points to 4.3, in the 77th percentile; stock fell 2.7% w/w; RSI: 30
    • Danone skew up 0.2 points to 5.6, in the 83rd percentile; stock rose 0.3% w/w; RSI: 50
  • Biggest skew decliners:
    • Bayer skew down 4 points to -3.4, in the 1st percentile; stock fell 0.4% w/w; RSI: 63
    • Santander skew down 3.4 points to 6.8, in the 23rd percentile; stock rose 5.3% w/w; RSI: 60
    • AXA skew down 2.9 points to 7.3, in the 35th percentile; stock rose 1% w/w; RSI: 50
    • Siemens Energy skew down 2.5 points to 2.1, in the 35th percentile; stock rose 5.7% w/w; RSI: 55
    • Mercedes skew down 2 points to 3.7, in the 21st percentile; stock rose 2.7% w/w; RSI: 62

The Information : Marvell In Advanced Talks to Buy Celestial AI in Multibillion

Marvell In Advanced Talks to Buy Celestial AI in Multibillion Deal

The Takeaway
  • Marvell is in advanced talks to acquire chip startup Celestial AI.
  • The total value of the deal including earnouts could be over $5 billion.
  • Celestial AI develops optical interconnect technology for faster AI data movement.

Marvell is in advanced talks to buy Santa Clara-based chip startup Celestial AI in a cash-and-stock deal worth multiple billions of dollars, according to people with knowledge of the deal.

Under the deal they’re discussing, Marvell would pay several billion dollars upfront for the startup, which has yet to generate any revenue, according to one of the people. Celestial has the potential to receive performance earnouts if it hits certain product milestones, said the same person. The total deal price, including earnouts from product milestones could be higher than $5 billion.

A deal could be announced as soon as Tuesday, the people said.

Celestial AI was last valued at $2.5 billion in March and has raised more than $580 million from investors including Fidelity Management, BlackRock and Tiger Global Management.

Founded in 2020, Celestial is developing an optical interconnect technology designed to more efficiently move data between AI processors and memory inside data centers. Along with including Lightmatter and Ayar Labs, it is one of several startups that are using photonics, or light, rather than electrical systems to make AI run faster.

Lip-Bu Tan—a semiconductor veteran and the CEO of Intel—joined Celestial’s board of directors in January of this year.

Marvell designs and develops semiconductor chips for data centers, networking and storage systems. It competes with Broadcom in the custom AI chip business and counts Amazon Web Services as one of its customers.

Shares of Marvell are down roughly 20% this year and currently has a market capitalization of around $75 billion. In contrast, other rival chipmakers such as Nvidia, Broadcom and AMD all surged this year.

The CEO of Celestial, David Lazovsky, did not respond to a request for comment. A spokesperson for Marvell didn’t immediately respond to a request for comment.

>>> US After Hours Summary: MDB +20.2%, CRDO +17.8% sharply higher on earnings;

After Hours Summary: MDB +20.2%, CRDO +17.8% sharply higher on earnings; JANX -41.1% under pressure after interim trial data; VSTS -5.1% lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: MDB +20.2%, CRDO +17.8%, EHC +1.6% (guidance)

Companies trading higher in after hours in reaction to news: ACIC +2.7% (special dividend of $0.75/share), SB +2% (new 10 mln share repurchase program), PACS +1.7% (business updates), FCF +1.5% (new $25 mln share repurchase program), CMC +1.4% (completes acquisition of Concrete Pipe & Precast), WBD +1.2% (ticks higher on report that it was fielding a second round of bids on Monday, including a mostly cash offer from Netflix, according to Bloomberg), NVTS +1% (availability of new ultra-high voltage products), STLD +0.8% (completes acquisition of remaining 55% equity interest in New Process Steel), HL +0.2% (permit for 2026 Polaris Exploration Program), AMZN +0.2% (testing Amazon Now in Seattle and Philadelphia), BA +0.2% (awarded $104 mln Navy contract), ESRT +0.1% (new retail leases with HOKA and Tecovas), PRG +0.1% (to acquire Purchasing Power), ATKR +0.1% (sale of its Tectron Mechanical tube product line), AAPL +0.1% (SVP for Machine Learning and AI Strategy stepping down)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: VSTS -5.1%, HUN -4.3% (guidance), SLP -0.1%

Companies trading lower in after hours in reaction to news: JANX -41.1% (updated interim data for JANX007), VENU -8.1% ($1 bln mixed shelf offering), BKV -6% (6 mln share offering), IREN -5.2% (convertible notes offering), CART -5% (in response to AMZN's ultra-fast delivery options), AGRO -1.8% (binding offer to acquire 50% stake in Profertil S.A.; also mixed shelf offering), VVV -0.9% (completes acquisition of Breeze Autocare), AMRX -0.8% (FDA approval of cyclosporine ophthalmic emulsion), DASH -0.5% (in response to AMZN's ultra-fast delivery options), OOMA -0.1% (completes FluentStream acquisition), SEG -0.1% (names new CFO), BLTE -0.1% (proposed public offering of American depositary shares), CTRE -0.1% (acquires three Texas senior living communities), O -0.1% $800 mln preferred equity investment in CityCenter Las Vegas Real Estate Assets)

SCMP : Why mammals that band together may face lower cancer risks

Why mammals that band together may face lower cancer risks
In cooperative societies – like elephants or whales – natural selection seems to favour genetic mechanisms that suppress cancer, study says

Much research on cancer prevalence has focused on genetic, environmental and lifestyle factors. But a new study by Argentine researchers offers a novel evolutionary perspective: the social structure of mammals may play a critical role in cancer risk.
The new angle has been proposed by researchers from the cancer philosophy and biology systems group at the University of Buenos Aires, led by Professor Matías Blaustein.

Their study, published on November 12 in the journal Science Advances, suggests that species characterised by strong social cooperation exhibit significantly lower cancer rates, while those shaped by intraspecific competition face higher risks.

There are disparities in cancer rates across human populations. According to the World Health Organization, the United States, with a population of 340 million, had one of the highest age-standardised cancer incidence rates in the world in 2022, at 376 cases per 100,000 people.

China, with a population of 1.4 billion, reported an incidence of 201.6 per 100,000, with both facing environmental challenges.

The interdisciplinary team led by Blaustein drew on extensive data sets – including records from more than 110,000 zoo animals across 190 species, tumour prevalence studies and comparisons of archetypal species such as cancer-resistant whales and more susceptible jaguars.

They integrated insights from mathematics, ecology, physics and molecular biology for the study titled “Coevolution of cooperative lifestyles and reduced cancer prevalence in mammals”.

They found that in cooperative societies – such as elephant herds or whale pods – older individuals played a vital role in guiding the group, such as leading migrations or teaching survival skills.

Because their survival benefited the whole community, natural selection appeared to favour genetic mechanisms that suppress cancer.

In contrast, in species marked by high intraspecific competition, the researchers observed a paradoxical phenomenon known as the “Hydra effect” – a concept borrowed from ecology where removing individuals, like cutting off a Hydra’s head, inadvertently increased population growth.

In this context, higher cancer mortality among older individuals could free up resources for younger ones, potentially allowing traits that predispose the species to cancer to persist across generations, according to the paper.

Notably, the study challenges long-standing assumptions – such as Peto’s paradox – that link larger body size or higher metabolism to greater cancer risk.

Elephants and whales, despite their massive size and long lifespans, have evolved powerful cancer defences: elephants carry 19 extra copies of the tumour-suppressor gene TP53, while certain whales have enhanced DNA repair mechanisms.

These traits, the researchers argue, are not random but have coevolved alongside cooperative social systems in which elder survival rates enhance group fitness.

Blaustein, a biologist, cancer researcher and philosopher, said he had harboured many questions about cancer for around a decade.

“Pathological conditions classified as cancer not only kill one of six people in the world, they are also widely distributed across the tree of life,” he said in an exclusive interview with the South China Morning Post.

“We identified that species with a competitive lifestyle have higher cancer and cancer mortality rates than the cooperative species.

“We hypothesised that this could have a fitness-positive role as a programmed-obsolescence mechanism ... where the cancer activates at a certain age to allow population recycling and enable younger individuals to survive.”

Catalina Sierra, a biologist and principal author of the research article, said: “We used three large public data sets.

“The first one included information on more than 110,000 zoo animals, covering around 190 mammal species, from elephants and whales, which very rarely develop cancer, to cats or rodents, where cancer is much more common.

“The second data set measured how common tumours [neoplasia] are across a smaller group of species. The third data set focused on ‘archetypal’ species, those with extreme cancer rates,” she told the Post.

“For example, species like whales or elephants with very low incidence, versus species such as jaguars or Tasmanian devils, where cancer appears more often.”

Blaustein said some animals lived and moved in groups, such as buffalo.

“The more experienced individuals – the elders – are the ones who show the way to drinkable water or to places where food is more abundant. This benefits the whole herd. The cooperation, as life in a group, could favour the survival of these animals,” he said.

There were also differences depending on whether they lived or bred in groups or solitarily, he said.

“If a mother has only one offspring, it receives all the care, the love and dedication. On the contrary, bigger families have competition between offspring for feeding, with the consequence that the weaker frequently die,” he said.

The researchers analysed issues such as the timing of breeding stages, body size, maternal or paternal care during the breeding stages, differences between polytocous and monotocous species – having multiple offspring compared with single offspring – diet and lifestyle in relation to cancer prevalence and mortality rate.

“We carried out statistical analyses to look for links between cancer and different lifestyle or life-history traits,” Sierra said.

“Then, together with physicists and mathematicians, we built a population model that divides individuals into young, reproductive adults and older non-reproductive adults; the model considers resource availability and how cooperative or competitive individuals are.

“This allowed us to simulate different scenarios and see in which conditions mortality among older adults [which in the model represents cancer incidence] increases.”

Sierra said the results were conclusive.

“What was remarkable was that the trends that appeared in the simulations matched what we observed in the real data: in more cooperative populations, cancer tends to be less frequent, while in more competitive ones it can even have a “beneficial” effect at the population level, because it favours the renewal of individuals,” she said.

“It is a counterintuitive result, but it is very revealing of how the way species are socially organised can influence their vulnerability to cancer.”

Blaustein argued that, “In ancient Greek mythology, if you cut the Hydra head, hoping to kill it, it had a paradoxical effect, producing more heads …

“In the cancer field we demonstrated with mathematical models that the competitive species benefit from higher cancer rates; on the contrary, the cooperative species find an advantage in lower cancer rates.”

Even though the Argentine team did not research differences between human groups and only compared humans as one species with other mammalian species, Blaustein speculated that the study could be used to analyse and debate the social organisation and life of human beings.

“Human beings present another level of complexity due to the interrelation between biological and socio-cultural issues,” he said.

“We did not work directly with humans but in speculative terms, humanity has evolved based on its socialisation and cooperation capacity to live in groups, feed and look for resources.”

“The current global productive system is associated with greater competition, individualism and increasing inequalities; so it should not be surprising to find a 22 per cent increase in cancer cases in the last 30 years.

“People have to work between 10 and 14 hours in some cases, without having time to sleep even eight hours a day, nor being able to enjoy leisure or sports. This generates immunosuppression. All this is a key factor in cancer progression in our bodies.”

Blaustein offered his opinion that inequalities were a crucial factor in the prevalence of cancer and illness in humans.

“Despite the biomedical developments, we are not seeing lower cancer rates. A considerable part of lower-income countries has an increase in cancer mortality rates,” he said.

He said cancer rates were not likely to decline in cases such as in Argentina where carcinogenic pesticides were sprayed near rural schools close to crop fields.

“It is not difficult to imagine another society with stronger bonds between humans and non-human living beings. We should think of a different society based on mutual aid, collaboration and cooperation as a way to avoid cancer.

“We should think of healthcare as a right and not a business, being able to have early diagnosis and treatments.”

However, he said the mammal study had limits when it came to analysing human social issues.

“We worked with primates. In this group we found high and low cancer incidence rates. Also, we found competitive and cooperative species. So, analysing primates we cannot have an obvious conclusion related to humans.”