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Tag: acquisitions

  • Mobileye prices IPO above targeted range to raise nearly $1 billion, and most of it will go to Intel

    Mobileye prices IPO above targeted range to raise nearly $1 billion, and most of it will go to Intel

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    Mobileye Global Inc. priced its initial public offering higher than its targeted range late Tuesday to raise nearly $1 billion, most of which will go to Intel Corp.

    Mobileye priced its initial public offering at $21 late Tuesday, the company announced in a news release, after previously stating a targeted range of $18 to $20; shares are expected to begin trading on the Nasdaq under the ticker symbol “MBLY” on Wednesday. Intel
    INTC,
    +0.85%
    will sell at least 41 million shares of Mobileye, which would raise $861 million, and also agreed to a $100 million concurrent sale of stock to General Atlantic, which would make the total raised at least $961 million.

    Intel paid $15.3 billion to acquire Mobileye in 2017, and was reportedly aiming for a valuation as high as $50 billion when originally planning this IPO, but instead will settle for a basic valuation of roughly $16.7 billion. After a record year with more than 1,000 offerings in 2021, the IPO market has largely dried up in 2022.

    Read: Mobileye IPO: 5 things to know about the Intel autonomous-driving spinoff

    Underwriting banks — Intel listed two dozen underwriters, led by Goldman Sachs Group Inc.
    GS,
    +1.13%
    and Morgan Stanley
    MS,
    +1.36%
    — have access to an additional 6.15 million shares for overallotments, which could push the total raised higher than $1 billion and make Mobileye the second-largest offering of the year. Only two offerings thus far this year have raised at least $1 billion — private-equity firm TPG Inc.
    TPG,
    +4.21%
    raised exactly $1 billion in January, and American International Group Inc. 
    AIG,
    -0.11%
    spinoff Corebridge Financial Inc.
    CRBG,
    +1.36%
    raised at least $1.68 billion in September.

    Intel will receive the bulk of the proceeds of the offering — after promising to make sure that Mobileye has $1 billion in cash and equivalents, the chip maker will take the rest of the proceeds for its own coffers. Wells Fargo analysts calculated that Mobileye will need about $225 million to hit that level, leaving at least $736 million for Intel before fees and other costs.

    Intel will also maintain control of the company after spinning it off, keeping class B shares that will convey 10 votes for each share while selling class A shares that convey one vote per share. Intel will retain more than 99% of the voting power and nearly 94% of the economic ownership of the company, and the Mobileye board is expected to include four members with ties to Intel, including Chief Executive Pat Gelsinger serving as chairman of the board.

    Read also: Intel files for Mobileye IPO, creating a share structure that will keep the chipmaker in control

    Mobileye will continue to be led by founder Amnon Shashua, who served as chief executive before Intel acquired the company and stayed at the helm while it was part of the Silicon Valley chip maker. Shashua founded Mobileye in 1999 and turned it into a pioneer in the field of automated-driving technology and one of Israel’s most prominent tech companies.

    Mobileye filed for the initial public offering at the end of September, when executives were still reportedly hoping for a $30 billion valuation.

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  • Twitter shares slump after report that the U.S. mulls national-security reviews for some of Elon Musk’s ventures

    Twitter shares slump after report that the U.S. mulls national-security reviews for some of Elon Musk’s ventures

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    Shares of Twitter plunged in premarket trade on Friday after a report Biden administration officials are considering subjecting some of Elon Musk’s ventures to national-security reviews.

    Twitter
    TWTR,
    +1.18%
    shares plunged 9% to $47.64 in premarket trade, below the $54.20 per share buyout price.

    Bloomberg News reported late Thursday that some U.S. officials have become concerned in recent weeks by Musk’s Russia-friendly tweets and his threat to cut off Starlink satellite internet service to Ukraine. The Tesla
    TSLA,
    -6.65%
    and SpaceX CEO’s pending $44 billion acquisition of Twitter has also reportedly drawn concerns because of its foreign investors, including a Saudi prince, Binance Holdings — a crypto exchange that was initially based in China — and Qatar’s sovereign wealth fund.

    Citing anonymous sources familiar with the matter, Bloomberg said discussions are still in the early stages and officials are trying to figure out what regulatory tools are available to them. One option could be a national-security review by the Committee on Foreign Investment in the United States, the report said.

    Separately, Bloomberg also reported late Thursday that Musk’s lawyers and bankers are preparing paperwork for the Twitter deal to be completed ahead of a Oct. 28 deadline, and that relations between Musk and Twitter have turned cordial rather than adversarial.

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  • Snap investors, do you still trust Evan Spiegel?

    Snap investors, do you still trust Evan Spiegel?

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    When Snap Inc. went public in 2017, this column boiled down the entire investment opportunity to one, simple question: Do you trust Evan Spiegel?

    As Snap
    SNAP,
    -0.64%
    stock heads toward its lowest prices since March 2020, and potentially even lower, that question is even more important, and answering “yes” should be even harder.

    Three months ago, amid the beginning of a huge slowdown in the ad business, Snap initiated a unique dividend meant to ensure that the founders maintained control of the company, even if they sold their stock — protecting themselves. Then in August, news came that Snap was laying off one in five employees. As Snap again reported disappointing results Thursday and saw the stock plunge again, the company decided now was the time to initiate a stock buyback plan, promising to spend up to $500 million to offset the dilution from employee stock plans — in the past nine months, Snap has spent $937 million on stock-based compensation.

    On the face of it, this seems like an investor-friendly approach — Barron’s pointed out earlier this year that investors were suffering while employees were faring better with the hefty stock-comp plans. But it’s also worth pointing out who the biggest investors in Snap are: Spiegel and his co-founder Bobby Murphy.

    As the company’s largest individual shareholders, Spiegel and Murphy are among the key beneficiaries of Snap’s plans to buy back stock, which usually leads to a boost in the stock price. Those two still control over 99% of the voting power of the company’s capital stock, and as the parent of Snapchat reminded investors in its annual report, “Mr. Spiegel alone can exercise voting control over a majority of our outstanding capital stock.”

    Shares of Snap tumbled an additional 25% to just under $8 in after-hours trading, putting them near the lowest prices since March 2020. On Thursday, the company ended regular trading hours with a market capitalization of around $17.91 billion, but that was headed toward $13 billion with the after-hours collapse.

    Besides protecting themselves and their investment, Snap’s executives have shown little ability to head off big issues, nor offer any worthwhile solutions to the current ad downturn. In the third quarter, its revenue grew a paltry 6%, down from the most recent second-quarter revenue growth of 13%. Snap appears to be in a steady revenue slowdown, from its peak growth of 116% in the June 2021 quarter.

    Snap has blamed both privacy changes that Apple Inc.
    AAPL,
    -0.33%
    made to the iPhone that affected ad tracking, and more recently, the macroeconomic advertising climate, while avoiding one of the biggest factors — the rise of TikTok. Top executives didn’t seem to see any of those challenges coming early enough, and did not do enough about them once they did.

    “The company was slow to react — or acknowledge — the significant headwinds faced by privacy initiatives, compounded by competition, and more recently macro headwinds,” Colin Sebastian, an analyst at Baird Equity Research, wrote in a note.

    The competition factor, mostly from China’s TikTok, was addressed briefly on the company’s call with analysts, but was not really acknowledged by Snap leaders.

    “We believe that the differentiated nature of our service is what’s contributing to the daily active-user growth, which grew 19% year-over-year to 363 million daily active users,” Spiegel said. “In terms of the content specifically, I think there’s a lot of headroom, of course, to continue to grow content engagement.”

    In the company’s shareholder letter, Spiegel acknowledged that the results were “far from our aspirations,” and that Snap would use this time of reduced demand “to pull forward and accelerate changes to our advertising platform and auction dynamics that we believe will deliver better results for our advertising partner.”

    Spiegel is known for going by his own instincts and not listening to other executives, employees or even market forces, as was noted in a Wall Street Journal report that detailed his push for an unsuccessful product redesign in 2018. While the company appeared to have snapped back from that debacle last year, it is now facing a fiercer rival for young people on social media in the form of TikTok.

    Investors who still have patience to wait and see if this stock ever recovers will also have to stick around with Spiegel — and as our IPO column noted — Snap is unapologetically founder-controlled. No change at the top can ever come unless it is initiated by Spiegel himself. Investors have to make a leap of faith that Spiegel can turn things around, but they need to remember that Spiegel usually thinks about himself first.

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  • Elon Musk teases massive Tesla stock buyback as CFO trims forecast for annual deliveries and stock falls

    Elon Musk teases massive Tesla stock buyback as CFO trims forecast for annual deliveries and stock falls

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    Tesla Inc. Chief Executive Elon Musk suggested the electric-vehicle maker could repurchase up to $10 billion worth of its stock Wednesday, as shares declined following a third-quarter revenue miss and his CFO brought down delivery expectations for the full year.

    Some Tesla
    TSLA,
    +0.84%
    investors have been agitating for a stock buyback after multiple stock splits and the company losing more than a third of its market capitalization in 2022, and Musk said in an earnings conference call that Tesla’s board has discussed a buyback in the range of $5 billion to $10 billion.

    “We debated the buyback idea extensively at board level. The board generally thinks that it makes sense to do a buyback, we want to work through the right process to do a buyback, but it is something possible for us to do a buyback on the order of $5 [billion] to $10 billion even in a downside scenario next year, given next year is very difficult,” he said, adding that it “is obviously pending board review and approval.”

    “So it’s likely that we will do some meaningful buyback,” he concluded.

    The statement did not immediately move Tesla’s stock, as it was followed closely by a forecast revision from Chief Financial Officer Zachary Kirkhorn, who said, “We do expect to be just under 50% growth [for deliveries] due to an increase in the cars in transit at the end of the year.”

    Tesla delivered a record number of cars in the third quarter, but still missed analysts’ expectations and made it more difficult to hit executives’ target for the year of an increase of more than 50% in vehicle deliveries. Kirkhorn said that the company will increase production of cars by 50%, “although we are tracking supply-chain risks which are beyond our control.”

    Shares declined more than 6% following the car company’s earnings report. Tesla reported third-quarter earnings of $3.29 billion, or 95 cents a share, on sales of $21.45 billion, up from $13.76 billion a year ago. After adjusting for stock-based compensation, the electric-vehicle manufacturer reported earnings of $1.05 a share, up from 62 cents a share a year ago.

    Analysts on average were expecting adjusted earnings of $1 a share on sales of $21.98 billion, according to FactSet. Tesla shares declined about 5% in after-hours trading immediately following the release of the results, after closing with a 0.8% increase to $222.04 in the regular trading session.

    Tesla shares have fallen more than 37% so far this year, a harder descent than the 22% decline of the S&P 500 index
    SPX,
    -0.67%    ,
    after years of outsize gains. Pundits have put forth a variety of reasons for the downturn, including increasing competition in the EV market, negative press around Tesla’s full-self-driving claims and actual performance, and Musk’s attention being diverted to his attempt to acquire Twitter Inc.
    TWTR,
    +0.10%    .

    Don’t miss: Market share for electric vehicles expected to roughly double

    None of that cowed Musk, however. He predicted that Tesla would be worth as much as the two most valuable companies in the world, Apple Inc.
    AAPL,
    +0.08%
    and Saudi Arabian Oil Co.
    2222,
    +0.42%    ,
    combined. Both companies have market capitalizations topping $2 trillion.

    “Now I am of the opinion that we can far exceed Apple’s current market,” Musk said on the call, after referencing a previous prediction that Tesla would reach Apple’s then-record market cap. “In fact, I see a potential path for Tesla to be worth more than Apple and Saudi Aramco combined. That doesn’t mean it will happen or that it will be easy, in fact it will be very difficult, require a lot of work, very creative new products, expansion and always good luck. But for the first time I’m seeing, I see a way for Tesla to be, let’s say roughly twice the value of Saudi Aramco.”

    In a preview of the report Tuesday, Wedbush Securities analyst Daniel Ives said that “the Street is starting to worry that the bloom is coming off the rose in the Tesla story with delivery shortfalls front and center.”

    “Between logistical issues in China, supply-chain problems, FSD black-eye moments, the Musk Twitter fiasco and EV competition increasing across the board, there is growing pressure on Musk & Co. to prove themselves,” Ives wrote.

    Tesla’s automotive gross margin, which declined in the second quarter despite price increases that Musk called “embarrassing,” were the same sequentially at 27.9%. Operating margin increased both sequentially and year-over-year, however, to 17.2% from 14.6% both in the third quarter a year ago and the previous quarter.

    Earnings preview: Do record Tesla deliveries mask a demand problem?

    In their communications with investors on Wednesday, Tesla executives disclosed that they will change the process for one of their most challenging tasks of late — transporting cars — in hopes of bringing costs down.

    “We are reaching such significant delivery volumes in the final weeks of each quarter that transportation capacity is becoming expensive and difficult to secure. As a result, we began transitioning to a smoother delivery pace, leading to more vehicles in transit at the end of the quarter,” the company’s shareholder deck reads. “We expect that smoothing our outbound logistics throughout the quarter will improve cost per vehicle.”

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  • Why Start a Business When You Can Buy One? Here’s What You Need to Know.

    Why Start a Business When You Can Buy One? Here’s What You Need to Know.

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    Opinions expressed by Entrepreneur contributors are their own.

    The process of starting a business from scratch can be very daunting and time-consuming. There are many things to consider, such as business structure, marketing, R&D/product development (if you’re creating something), raising capital, finance, legal matters, etc. One of the first things you need to look at when starting a business is simply the amount of money it’ll take to get the business off the ground. For many people, it can be difficult to come up with or raise the initial investment needed to start a business from scratch.

    Let me be clear here, I’m not advocating against anyone starting a business or anyone building a new company at all. I’ve conceptualized at least 15 or so different business ideas and was able to bring a handful of them to life, although many didn’t get off the ground or even go to market for that matter.

    I think all entrepreneurs, at some point in time, should get their hands dirty in creating something from scratch. I think most will probably conceptualize an idea or two that they want to take to market because it may be the next greatest “thing,” in their specific target marketplace, and they’ll have an awesome learning experience doing so — and some will inevitably achieve the success that they imagined they would.

    Related: 5 Reasons to Buy a Successful Business Instead of Starting a New One From Scratch

    The many benefits of buying a business

    With that being said, though, I think that the notion of buying an existing business may be a much better option both from a fiscal responsibility standpoint (and pragmatically, for that matter). When you buy a business, you’re acquiring a customer base, established systems and processes, potential assets (physical and digital) and much, much more!

    Another reason buying a business makes sense is that you can usually get it at a discount. This is because businesses often sell for less than their actual value, since the owner(s) may be motivated to sell quickly due to personal or financial reasons. And lastly, an existing business comes with an established reputation and goodwill, which can save you a lot of time and money in marketing and advertising costs.

    These factors alone can give you a significant advantage over businesses that are starting from scratch. But the key to success in purchasing a business is finding “the right business” to purchase. It’s subjective, I know, but there are some general frameworks that you can use to guide you and aid in your journey to evaluating and eventually closing on your first business acquisition.

    There are more businesses for sale today than there are buyers

    As you may or may not know, businesses for sale have grown exponentially in the last decade. There are many reasons for this, including the current state of the economy, retirement and quite a few others.

    Business owners are facing financial difficulties in some instances and are unable to continue operating their businesses. While it may not seem like a good thing, in a down economy, there is an opportunity for those looking to purchase a business. I’m not suggesting that it’s a time to take advantage of someone, but I am saying that you can acquire businesses for fair prices, in some cases, well under market value.

    There’s a significant cohort of business owners who are about to enter or seeking to enter retirement. They may not have family members or children to pass their business on to, so in some cases, businesses simply go out of business or cease to exist. Herein lies an opportunity, for you, as someone seeking to become a business owner.

    Related: 10 Questions You Must Ask Before Buying a Business

    It’s easier for existing businesses to generate cash flow

    Simply put, cash flow is the lifeblood of any business, big or small. It’s the money coming in and going out, and it needs to be managed carefully to ensure the business is healthy and profitable.

    It is generally easier for an existing business to generate cash flow than for a startup business or brand-new company. This is because an existing business typically has revenue streams from customers and other sources, while a startup or new company may not yet have any of those things. An existing business should be generating income through existing channels or specific sources that it currently employs.

    Increasing cash flow is just as important as reducing expenses when it comes to boosting profitability. A business can only grow if it has enough cash on hand to invest in new opportunities. Remember: Increasing cash flow is essential for long-term success in any business.

    You’re purchasing a proven model

    When you’re starting a business, one of the inevitable questions that you’ll be asking yourself is “How am I (or how are we) going to make money?” Fortunately, this isn’t necessarily one that you’re going to have to answer if you’re buying an existing business. Existing companies typically have proven revenue models. This means that they’ve successfully sold and continue to sell its products or services. The repeatability of this model is what you’re looking for when you’re purchasing a company.

    A startup business, on the other hand, may not have a proven revenue model because it has not yet sold its products or services. This can be due to a variety of reasons, such as the company being new and therefore having no track record, or because the products or services are not yet ready for market. Either way, a lack of a proven revenue model can be a major obstacle for a startup business.

    Related: No Big Startup Idea? No Problem. Here’s How to Buy a Business.

    There are many reasons to buy an existing business instead of starting one from scratch. Perhaps (as I’ve mentioned), the most compelling reason is that you’re buying a proven business model. The riskiest part of starting a new business is figuring out whether your business model will actually work and be profitable. With an existing business, you know that the business model works and that the business can be profitable.

    Hopefully, I’ve inspired you to jump-start your journey toward acquiring your first existing business! Remember, you need to completely educate yourself in business before you start trying to acquire them. There are inherent, built-in risks associated with business ownership that so many fail to recognize or understand. This isn’t meant to discourage you, it’s simply to let you know that the details really do matter in business, so don’t overlook them!

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    David N. Peterson

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  • Russia Wipes Out Exxon’s Stake in Sakhalin Oil-and-Gas Project

    Russia Wipes Out Exxon’s Stake in Sakhalin Oil-and-Gas Project

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    Russia Wipes Out Exxon’s Stake in Sakhalin Oil-and-Gas Project

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  • Why It’s Time to Buy This Uranium Miner’s Stock

    Why It’s Time to Buy This Uranium Miner’s Stock

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    Heading into this past week, uranium miner


    Cameco


    was that rare stock in the market: It had posted a double-digit gain in 2022. One deal made those gains disappear—and created a buying opportunity.

    At first glance, there didn’t seem to be all that much that was controversial about the joint venture Cameco (ticker: CCJ) announced this past Tuesday. Along with


    Brookfield Renewable Partners


    (BEP), Cameco agreed to buy Westinghouse Electric, a servicer to nuclear power plants, for $7.88 billion, including debt. Cameco will own 49% of the joint venture once the deal is completed.

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  • Kroger and Albertsons Say Their Merger Will Cut Prices. Their Shares Are Tumbling.

    Kroger and Albertsons Say Their Merger Will Cut Prices. Their Shares Are Tumbling.

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    With inflation still an untamed threat, Friday’s announced merger of the grocers


    Kroger


    and


    Albertsons


    will spur debate about whether the consolidation will raise food prices, or lower them.

    The Biden administration’s antitrust regulators are scrutinizing mergers more closely than did predecessors, and an old argument against combinations is that they lead to price-gouging.

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  • Ridgefield Partners Announces Launch of Middle-Market M&A Advisory Practice

    Ridgefield Partners Announces Launch of Middle-Market M&A Advisory Practice

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    Press Release
    –

    Oct 12, 2022


    DENVER, October 12, 2022 (Newswire.com)
    –
    Veteran private equity fund manager Richard Waryn has joined forces with transportation and logistics entrepreneur Todd Harman and M&A specialist Michael Seeley to form Ridgefield Partners LLC, a top-tier mergers & acquisitions and strategic advisory firm serving the middle-market. According to Waryn, “Our objective is to bring world-class client service to a historically underserved market segment.”

    Ridgefield is focusing on serving sell-side and buy-side clients in a wide range of sectors in the $10 million to $150 million enterprise value size range. The principals of the firm have particular expertise in transportation and logistics, construction, and business services. Collectively, the Ridgefield team has closed deals all over the world across a wide variety of sectors including transportation, infrastructure, telecommunications, retail, manufacturing, and technology.

    In addition to the founders, Stephen Boane will join the firm as Senior Managing Director. In addition to his background in private equity and investment banking, Boane also built up and sold Traemand, the largest kitchen installation services provider to IKEA. He sold Traemand in 2018. Boane brings tremendous insight into the business services sector and a deep understanding of what it means to own, operate, and sell a business.

    Todd Harman added, “Our real objective is to help business owners maximize the value of their businesses, whether that means selling them immediately or positioning them for later sale or merger.”

    Mike Seeley added, “Almost everyone that you will work with at Ridgefield has owned, operated, and sold a business of their own. We combine technical experience and rigor with the perspective of having been operators. This experience makes a difference both in valuation and how the transaction proceeds. Very few advisors can make that claim. I’m humbled to be working alongside a team of people who can.”

    About Ridgefield Partners

    Ridgefield Partners is a specialized mergers & acquisitions firm servicing middle-market companies throughout North America. Ridgefield combines a proven track record in M&A, private equity, and investment banking with the perspective of having owned, operated, and sold businesses as principals. The firm has offices in Denver, Seattle, Portland, and Nashville. Visit https://www.ridgefieldpartners.com/ for more information.

    Contact: 
    Michael Seeley
    Phone: (425) 403-2605
    mseeley@ridgefieldpartners.com

    Source: Ridgefield Partners

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  • WSJ News Exclusive | Peloton Co-Founder John Foley Faced Repeated Margin Calls From Goldman Sachs as Stock Slumped

    WSJ News Exclusive | Peloton Co-Founder John Foley Faced Repeated Margin Calls From Goldman Sachs as Stock Slumped

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    John Foley, the co-founder and former chief executive of Peloton Interactive faced repeated margin calls on money he borrowed against his Peloton holdings before he left the fitness company’s board last month, according to people familiar with the situation.

    As Peloton’s shares slumped over the past year, Goldman Sachs Group asked Mr. Foley several times to provide fresh funds or additional collateral for personal loans the bank had extended to him, the people said. The company’s share price has fallen nearly 95% from its $160 peak in December 2020.

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  • WSJ News Exclusive | Bio-Rad Laboratories in Talks to Combine With Qiagen

    WSJ News Exclusive | Bio-Rad Laboratories in Talks to Combine With Qiagen

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    Bio-Rad Laboratories is in talks to combine with fellow life-sciences company Qiagen NV in a deal that would be worth more than $10 billion, according to people familiar with the matter.

    The talks have been going on for a while but any agreement isn’t likely for another few weeks or more—and there may not be one.

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  • Ford stock is now a ‘sell’ at UBS as an oversupply problem looms

    Ford stock is now a ‘sell’ at UBS as an oversupply problem looms

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    Shares of Ford Motor Co. were hit hard Monday by UBS analyst Patrick Hummel’s recommendation that investors sell, as the auto industry is facing a worrisome U-turn from undersupply to oversupply.

    Hummel also cut his ratings on several other global auto makers, including General Motors Co.
    GM,
    -5.59%    ,
    saying that as a recession concerns grow, “demand destruction is no longer a vague risk.”

    In addition to all of the data suggesting the economy is slowing, Hummel said growing U.S. dealer inventories, weak used-car pricing, used-car dealer profit warnings and signs indicating deteriorating orders and shorter delivery times make him more cautious on the overall auto industry.

    Don’t miss: CarMax stock suffered biggest selloff since the year 2000, as inflation, low consumer confidence lead to big profit miss.

    “We think it will only take 3-6 months for the auto industry to end up in oversupply, which will put an abrupt end to a 3-year phase of unprecedented OEM [original equipment manufacturer] pricing power and margins,” Hummel wrote in a note to clients.

    As part of his negative industry outlook, he cut his rating on Ford
    F,
    -7.38%
    to sell from neutral and his stock price target to $10 from $13, with the new target implying about 11% downside from current levels.

    Ford’s stock sank 7.6% in morning trading. It was trading up just 0.6% month to date, after plunging 26.5% in September to suffer its worst monthly performance since it plummeted 30.6% during pandemic-stricken March 2020.

    Hummel noted that Ford has already warned about having more vehicles in inventory than expected, and above payments to suppliers running about $1 billion higher than projected, so he sees little margin left for negative surprises in terms of fourth-quarter deliveries and supply costs.

    Hummel cut his 2023 adjusted earnings-per-share estimate by 61% to 52 cents a share, to reflect a $6.5 billion drop in price and sales mix. The compares with the current 2023 FactSet EPS consensus of $1.87.

    “This sounds very negative, but Ford gains $19 billion in price alone since the beginning of 2020,” Hummel wrote.

    Also read: Ford again raises price of F-150 Lightning electric pickup.

    Read more: Ford September sales fall as drop in trucks offsets near tripling in EVs.

    Meanwhile, GM’s stock dove 6.9% in morning trading toward a three-month low, and shares have shed 2.5% so far this month after tumbling 16% last month.

    Hummel downgraded GM to neutral from buy, and dropped his price target by 32%, to $38 from $56.

    The rating remains above Ford’s, because unlike its rival, Hummel noted that GM has had “no hiccups” in its third-quarter production schedule and therefore a “solid” quarterly report is expected. However, the downgrade reflects the fact that GM is “not immune” to a downturn in the industry.

    Separately, Hummel also cut his stock-price target on Tesla Inc.
    TSLA,
    -0.16%
    to $350 from $367, saying that following a third-quarter volume report that was below expectations, it will be “more challenging” for the electric-vehicle maker to meet its 2022 delivery growth target.

    However, Hummel reiterated his buy rating on Tesla, as he believes the EV maker is best positioned to use pricing as the tool to fill its factories.

    “Overall, the recession outlook should result in moderately lower margins for Tesla than previously expected, but we’re highly confident that by keeping the top line [revenue] momentum, Tesla will even widen the gap vs. competitors in terms of profitability,” Hummel wrote.

    Ford’s stock has fallen 3% over the past three months, while GM shares have lost 3.1% and Tesla’s stock has dropped 11.8%. In comparison, the S&P 500 index
    SPX,
    -1.08%
    has declined 7.5% the past three months.

    Among other auto makers, he also downgraded both Renault SA
    RNO,
    +2.41%

    RNLSY,
    +1.17%
    and Volkswagen AG
    VOW,
    -3.29%
    to neutral from buy. He also downgraded auto parts makers Continental AG
    CON,
    +0.10%
    and Faurecia SE
    EO,
    -3.77%

    FURCF,
    -3.67%
    to neutral from buy.

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  • KeyStar Corp. Completes Acquisition of ZenSports and Ultimate Gamer Assets

    KeyStar Corp. Completes Acquisition of ZenSports and Ultimate Gamer Assets

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    Acquisitions expected to drive growth within the gaming, eSports, and fintech industries.

    Press Release
    –

    Oct 10, 2022


    LAS VEGAS, October 10, 2022 (Newswire.com)
    –
    KeyStar Corp.® (OTC: KEYR) is pleased to announce the acquisition of ZenSports’® and Ultimate Gamer’s® assets. As part of the acquisition of ZenSports’ assets and brand, the ZenSports team has joined KeyStar.

    ZenSports is a native-mobile enterprise, DeFi, and entertainment platform that offers a suite of sports betting, eSports, digital currency, payment, NFT, content curation, and identity solutions. Its underlying fintech backbone is being leveraged across all KeyStar brands and will be available as a standalone solution under the newly created Burstive™ brand. Ultimate Gamer is an eSports brand focused on competitive online and live eSports competitions. 

    “Together with our net new innovation initiatives, by acquiring both ZenSports’ and Ultimate Gamer’s assets, KeyStar has assembled a comprehensive platform capability that enables both business-to-business and direct-to-consumer offerings within the exciting sports betting, eSports, and fintech/digital currency markets,” according to KeyStar CEO John Linss. “The establishment of these three pillars represents an opportunity for KeyStar to grow our global business and provide many benefits for both our business and consumer clients. In addition, our leadership team has decades of experience in these industries, and we’re thrilled to have ZenSports’ amazing team join us as we acquire and grow these product lines and solutions.”

    Under the ZenSports brand, KeyStar expects to expand its sports betting presence in the U.S. and internationally. The company plans on obtaining both state and international gaming licenses targeted at both B2C operations and B2B licensing opportunities.

    KeyStar will host and manage all eSports tournaments under the Ultimate Gamer brand, except for those incorporating sports betting – all sports betting will take place within the ZenSports brand. Utilizing ZenSports’ proprietary eSports tournament technology and Ultimate Gamer’s eSports branding and audience, KeyStar plans to create an immersive gaming experience for all tournament and one-on-one matches.

    With the creation of the Burstive brand, KeyStar is leveraging ZenSports’ proven proprietary cryptocurrency payments API and trading exchange technology to create white-label fintech solutions for enterprise customers. “We’re excited to be able to offer enterprises a next-generation fintech solution that should encompass all the best that cryptocurrencies and decentralized finance have to offer,” according to Linss.

    ZenSports’ Co-Founder Mark Thomas on the acquisition, said, “We’re excited to be partnering with the experienced and innovative team at KeyStar. The combination of KeyStar’s brands and ZenSports technology provides an innovation platform that we believe will position KeyStar as the entertainment, gaming, and fintech technology leader for many years to come.”

    ZenSports, Inc. obtained its Nevada gaming license in August 2021. This acquisition of certain ZenSports’ assets does not include ZenSports’ Nevada assets or gaming license, and KeyStar will look to obtain its own Nevada gaming license in the near future. In the meantime, KeyStar intends to leverage ZenSports’ sports betting technology to grow in other strategic jurisdictions.

    Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “seek,” “believe,” “estimate,” “expect,” “strategy,” “likely,” “may,” “should” and similar references to future events or periods. 

    Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

    Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

    Source: KeyStar Corp.

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  • Judge delays Twitter v. Elon Musk trial to allow deal to close

    Judge delays Twitter v. Elon Musk trial to allow deal to close

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    The judge in a legal battle between Twitter Inc.
    TWTR,
    -3.72%
    and Tesla Inc.
    TSLA,
    -1.11%
    Chief Executive Elon Musk on Thursday delayed their trial, previously set for Oct. 17, to give the sides time to close the $44 billion acquisition at the heart of the beef. Trial was set to begin Oct. 17 in Delaware Chancery Court, but Chancellor Kathaleen McCormick ruled Thursday afternoon that the two sides would have until Oct. 28 to close the transaction. If Musk has not closed on his deal to buy Twitter by then, a trial date will be set for November, the judge ruled.

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  • Elon Musk would lose 13.5 million Twitter followers if he scraps most spam accounts; Justin Bieber would lose 27.6 million, data finds

    Elon Musk would lose 13.5 million Twitter followers if he scraps most spam accounts; Justin Bieber would lose 27.6 million, data finds

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    Elon Musk would lose about 13.5 million Twitter followers, if he pushes through his plan to get rid of most spam accounts, according to data crunched by CodeClan, a Scottish digital skills academy.

    The Tesla Inc.
    TSLA,
    -3.84%
    CEO on Tuesday gave up a legal battle and agreed to pay $44 billion to take over the social-media company. Musk has said he wants less than 5% of Twitter
    TWTR,
    -2.35%
    accounts to be spam.

    But Musk’s losses pale in comparison with singer Justin Bieber, who would lose 27.6 million of his 114.2 million followers, according to the data.

    Britney Spears would lose the highest percentage of fake followers out of the top 20 with some 48% of her 55.8 million followers being classified as fakes.

    See also: Elon Musk says Twitter will eventually be part of ‘X, the everything app’

    Former President Barack Obama would lose 19.3 million of his 131.9 million followers, the data shows.

    Among other high profile names; Katy Perry has about 23.3 million fakes among her 108.9 million followers, or 21.4% of the total; Rihanna has about 26.5 million fakes, or 24.9% of her 106.5 million followers; Lady Gaga has 10.9 million fakes in her roster of 84.7 million followers, for 12.9% of the total; Kim Kardashian has about 14 million fakes, or 19.4% of her 72.4 million followers, and Ellen DeGeneres has about 24.4 million fakes, equal to 31.5% of her 77.5 million followers.

    See now: Elon Musk’s legal battle with Twitter may be over, but his war with the SEC continues

    In the world of politics, Indian Prime Minister Narendra Modi has about 17.5 million fakes in his 78.8 million followers, equal to 22.2% of the total.

    CNN Breaking News has about 7.7 million fakes, or 12.2% of its 63.1 million followers. Bill Gates has about 14.3 million fakes, or 24.2% of his 58.9 million followers. And NASA has some 14.7 million fakes, or 26.8% of its 57.1 million followers.

    Twitter shares were slightly lower premarket, while Tesla was down 1.1%.

    Shares of Digital World Acquisition Corp.
    DWAC,
    +0.03%    ,
    the special-purpose acquisition company, or SPAC, buying the company behind former President Donald Trump’s Truth Social social-media company, was slightly higher premarket after falling more than 5% Tuesday in the wake of the Musk/Twitter news.

    The SPAC has fallen 67% in the year to date, while the S&P 500
    SPX,
    -1.28%
    has fallen 20%.

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  • Elon Musk wants to move forward with his purchase of Twitter. Here’s how some Twitter users reacted.

    Elon Musk wants to move forward with his purchase of Twitter. Here’s how some Twitter users reacted.

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    Elon Musk sent a letter to Twitter
    TWTR,
    +22.24%
    indicating he intends to move forward with his original proposal that he acquire the company for $54.20 a share, according to a filing from the Securities and Exchange Commission.

    The Tesla Inc.
    TSLA,
    +2.90%
    CEO agreed to buy the social media company back in April for $44 billion, but in recent months said he wanted to terminate the deal, publicly citing concerns about bots on the platform. The two sides had been entrenched in a legal battle over the past few months, and a Delaware Chancery Court judge was scheduled to hear arguments on the case in October, a case Wedbush analyst Daniel Ives said Musk was “highly unlikely” to win.

    See also: College students who got low grades complained about their ‘dismissive’ professor. Then NYU fired him.

    Twitter users reacted to the news on Tuesday afternoon, many of them joking about a potential resolution to the seemingly never-ending Elon Musk Twitter saga.

    One Twitter user said she believes Musk will look to reinstate the account of former President Donald Trump, which was banned shortly after the attack on the Capitol on Jan. 6, 2021. Trump has claimed he won’t return to Twitter even if the Musk deal is executed, and he’ll continue to post on his platform, Truth Social.

    See also: Trump’s Facebook ban may end as soon as January 2023, Meta executive says

    “We’re doing a big platform right now, so I probably wouldn’t have any interest,” the former president said.

    Another user tweeted that supporters of the meme crypto dogecoin
    DOGEUSD,
    +1.11%
    are excited by Musk’s move to proceed with the deal. Musk has touted dogecoin on several occasions in the past few years.

    Similar to bitcoin, dogecoin is a peer-to-peer, open-source cryptocurrency. It trades under the ticker symbol “DOGE” and features the face of the shiba inu from the popular Doge meme as its logo. Dogecoin was up as much as 9.16% after the Bloomberg news was published.

    Musk has not publicly commented on the report, but one Twitter user pointed out that he tweeted about his satellite internet project Starlink after the news broke, but did not mention Twitter in any way.

    A report from The Wall Street Journal stated Musk’s legal team relayed the proposal to Twitter’s team “overnight Monday.”

    Shares of Tesla Inc. dipped after the news, and are now up just 1.31% during Tuesday’s trading. Shares of the EV maker were up as much as 5.65% on the day before the Musk news.

    See also: SPAC backing Trump’s Truth Social hit by news Musk is again offering to acquire Twitter at original price

    The news comes a few days after hundreds of text messages from Musk’s phone were made public as evidence in Twitter’s lawsuit.

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  • Twitter stock surges 22% after Elon Musk gives up bot battle and commits to $44 billion deal

    Twitter stock surges 22% after Elon Musk gives up bot battle and commits to $44 billion deal

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    Tesla Inc. Chief Executive Elon Musk now plans to close his proposed $44 billion deal for Twitter Inc., according to a Tuesday filing that arrived less than two weeks before a judge was scheduled to hear a case on the disputed acquisition.

    Musk’s lawyers sent a letter to Twitter’s management team indicating that he was proposing to move forward with the original acquisition terms late Monday, and that letter was released as a filing with the Securities and Exchange Commission Tuesday afternoon. A Twitter spokesperson later confirmed to MarketWatch that the company intended to proceed with the deal for $54.20 a share.

    Twitter
    TWTR,
    +22.24%
    shares jumped 22.2% to $52 in Tuesday’s session, after an hours-long trading halt that started after Bloomberg News first reported the move around noon Eastern time, suggesting a possible end to the legal saga between the two parties. The increase is the second best daily percentage gain on record for Twitter stock, behind only the 27.1% gain experienced when Musk disclosed his initial ownership stake in Twitter in April. Twitter was the best performing stock Tuesday in the S&P 500 index
    SPX,
    +3.06%    ,
    and is now up 20.3% on the year.

    The two sides have been locked in a legal battle for months, and a Delaware Chancery Court judge was expected to hear from both sides in a five-day trial slated to begin Oct. 17. The Wall Street Journal reported Tuesday that the Delaware judge asked the two sides to come up with a plan by the end of the day that could bring about an end to the litigation.

    “Musk could see the writing on the wall that he was going to lose the trial,” said Josh White, an assistant finance professor at Vanderbilt University, in an email to MarketWatch. “By doing this, he can save legal costs, time and ultimately losing in a very public trial.”

    See also: Here’s how Twitter’s users reacted to Musk agreeing to buy the platform

    Musk agreed in April to buy Twitter in a deal that valued the company at roughly $44 billion, but he later said that he was terminating the deal. The Tesla
    TSLA,
    +2.90%
    CEO cited concerns about bot activity on Twitter and said he believed the company’s management team wasn’t accurate in its public disclosures about the extent of spam activity on the platform.

    White noted that text messages released in conjunction with the case showed that Musk was aware of Twitter’s bot issue before going forward with his original deal offer, and he doubted that Musk would be able to show that “something really changed” after that point.

    “If he offered less than $54.20, Twitter might have proceeded with the trial, and he would be deposed,” White continued. “By offering the original price, he maximizes the chance that Twitter accepts and the trial ends. I expect Twitter’s board to accept the deal and for it to close rather quickly.”

    Wedbush analyst Daniel Ives agreed that the Tesla leader’s latest move marked a “clear sign that Musk recognized heading into Delaware Court that the chances of winning vs. Twitter board was highly unlikely and this $44 billion deal was going to be completed one way or another,” he wrote in a note to clients. “Being forced to do the deal after a long and ugly court battle in Delaware was not an ideal scenario and instead accepting this path and moving forward with the deal will save a massive legal headache.”

    Opinion: Twitter stood up to Elon Musk and won, but will it feel like a win once he owns it?

    Vanderbilt’s White noted that a deal at the original price would be a “big” win for Twitter shareholders.

    “The stock price of Snap
    SNAP,
    +8.42%
    and Twitter seemed to trade around the same price level before the offer,” he told MarketWatch. “Snap is now a ~$10 stock with a $17 billion market cap. So Twitter’s shareholders win by getting $54.20 rather than having the price drop to $10-20 per share.”

    Additionally, he deemed Delaware business law another winner: “This deal shows that even the richest man in the world cannot overcome well-written contracts enforced in a neutral and fair way by the Delaware courts.”

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  • Buffett’s Likely Successor Buys $68 Million of Berkshire Stock

    Buffett’s Likely Successor Buys $68 Million of Berkshire Stock

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    Berkshire Hathaway


    Vice Chairman Greg Abel, the likely successor to CEO Warren Buffett, bought about $68 million of the company’s shares last Thursday in what appears to be his first purchases of Berkshire stock since he assumed the position in 2018.

    In several Form 4 filings Monday with the Securities and Exchange Commission, Abel disclosed that he purchased 168 Berkshire Hathaway (ticker: BRK/A, BRK/B) Class A shares through the Gregory Abel Revocable Trust on behalf of his wife, children, and other family members.

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  • Poshmark to be bought by South Korean internet company Naver in $1.2 billion deal

    Poshmark to be bought by South Korean internet company Naver in $1.2 billion deal

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    Online secondhand-fashion marketplace Poshmark Inc. has agreed to be bought by South Korean internet company Naver in a $1.2 billion deal, the companies announced Monday, a move that executives said would help both brands expand internationally.

    Shares of Poshmark
    POSH,
    -0.64%
    jumped 11.8% in after-hours trading on the news.

    Under the terms of the deal, Naver
    035420,
    -8.79%
    will acquire Poshmark’s outstanding shares for $17.90 in cash, representing a 15% upside to Poshmark’s Monday closing price of $15.57. The transaction is set to close by the first quarter of next year, pending Poshmark shareholders’ approval.

    Poshmark went public in late 2020, pricing shares at $42 a share, and ended its first day of trading at more than $100 a share, but has never approached those heights again. It last traded for more than the acquisition price Naver has agreed to pay late last year.

    For more: Five things to know about Poshmark

    In a statement, executives from both companies talked up the potential to combine Naver’s array of search, e-commerce, AI and social-media technology with Poshmark’s social and shopping platforms. Poshmark, the companies said, would also embark on a bigger international expansion strategy, including into other markets in Asia, in the “medium-term.”

    They also talked about the potential for the combined company to save around $30 million annually within two years after the deal’s closing through “rationalization of public company costs” and higher operating leverage, along with the potential for more than 20% yearly sales growth by harnessing Naver’s advertising resources.

    Naver, which runs large search and e-commerce platforms, said the move would broaden its e-commerce platform, bring younger users into the company’s fold and allow it to “capitalize on the global online fashion re-commerce and sustainable economy opportunity.”

    “Naver’s leading technology in search, AI recommendation and e-commerce tools will help power the next phase of Poshmark’s global growth,” Choi Soo-Yeon, Naver’s chief executive, said in a statement, which also said that Naver hosted a large number of digital content creators in Korea.

    Naver owns companies like Wattpad, a social-media platform, and runs Webtoon, a site for digital comics, along with a metaverse platform called Zepeto, and also has joint ownership of an internet service group in Japan. Naver said its online community in Korea consists of more than 36 million monthly users, who use its search engine and other services. 

    Poshmark Chief Executive Manish Chandra said the deal would also give Poshmark opportunities to grow. 

    “Longer term, as part of Naver, we will benefit from their financial resources, significant technology capabilities, and leading presence across Asia to expand our platform, elevate our product and user experiences, and enter new and large markets,” he said in the statement.  

    Naver said the acquisition would also help give it a bigger foothold in the U.S. And it said the deal would allow it to broaden the appeal of so-called live-stream shopping.

    “Live-stream shopping is a key driver of e-commerce in China and Korea (and increasingly in the U.S.) today, allowing shoppers to buy products in real-time through live video broadcasts, enabling greater insights and more clarity around purchasing decisions,” the statement said.

    Once the deal closes, Poshmark will be a standalone subsidiary of Naver, with the same management team, brand and headquarters in Redwood City, Calif., the companies revealed.

    At the close of Monday’s trading, shares of Poshmark were down around 9% year-to-date. The S&P 500 index
    SPX,
    +2.59%    ,
    by comparison, has slid 23% over that time.

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  • Finical Holdings, LLC Completes Acquisition

    Finical Holdings, LLC Completes Acquisition

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    Press Release
    –


    updated: Sep 27, 2021


    DALLAS, September 27, 2021 (Newswire.com)
    –
     Finical Holdings, LLC, a leading provider of electronic payments in North America, today announced it has completed its acquisition of Platinum Processing, LLC, DBA Zero Charge Processing.  

    Finical provides credit card processing services to thousands of businesses in North America. Finical markets its services through its relationships with Independent Sales partners, as well as strategic relationships with various vendors and Banks. Finical has over 2,200 sales agents throughout North America.

    Zero Charge Processing is a Texas based corporation providing credit card processing services to businesses in North America. Zero Charge Processing’s main focus is on eliminating up to 100% of their customer’s credit card processing fees, through use of the Cash Discount and Surcharge programs. 

    Aaron Nasseh, Finical’s CEO, commented: “We are excited to realize the synergy between the companies. Zero Charge has an impressive sales force, which brings with it over 300 well trained sales professionals, and a business model dedicated to providing the best customer experience for its clients.”

    Contact:

    Tiffany Mclain
    tmclain@finicalholdings.com
    469-501-7731

    Source: Finical

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