Tag Archives: Mergers and acquisitions

Entertainment

Taylor Swift: Live Nation exec will face lawmakers about concert tickets fiasco

Leave a comment


New York
CNN
 — 

Lawmakers are set to grill top executives from the event ticketing industry on Tuesday after Ticketmaster’s inability to process orders for Taylor Swift’s upcoming tour left millions of fans unable to buy tickets or without their ticket even after purchase.

Joe Berchtold, the president and CFO of Ticketmaster parent company Live Nation Entertainment, is set to testify before a Senate committee on Tuesday, two months after the Swift ticketing fiasco reignited public scrutiny of the industry. Jack Groetzinger, CEO of ticketing platform SeatGeek, is also scheduled to testify at the hearing.

Tickets for Swift’s new five-month Eras Tour – which kicks off March 17 and will have 52 concerts in multiple stadiums across the United States – went on sale on Ticketmaster in mid November. Heavy demand snarled the ticketing site, infuriating fans who couldn’t snag tickets. Customers complained about Ticketmaster not loading, saying the platform didn’t allow them to access tickets, even if they had a pre-sale code for verified fans.

Unable to resolve the problems, Ticketmaster subsequently canceled Swift’s concert ticket sales to the general public, citing “extraordinarily high demands on ticketing systems and insufficient remaining ticket inventory to meet that demand.”

As fury grew among legions of hardcore Swifties, Swift herself weighed in on the fiasco. “It goes without saying that I’m extremely protective of my fans,” Swift wrote on Instagram in November. “It’s really difficult for me to trust an outside entity with these relationships and loyalties, and excruciating for me to just watch mistakes happen with no recourse.”

As a result, the US Senate Judiciary Committee has scheduled the hearing on Tuesday, titled “That’s The Ticket: Promoting Competition and Protecting Consumers in Live Entertainment” to examine the lack of competition in the ticketing industry.

“The issues within America’s ticketing industry were made painfully obvious when Ticketmaster’s website failed hundreds of thousands of fans hoping to purchase tickets for Taylor Swift’s new tour, but these problems are not new,” Sen. Amy Klobuchar, who sits on the committee, said in a statement about the hearing. “We will examine how consolidation in the live entertainment and ticketing industries harms customers and artists alike. Without competition to incentivize better services and fair prices, we all suffer the consequences.”

In his prepared opening remarks, Berchtold blamed “industrial scalpers” for recent online ticketing snafus and called for legislation to rein in those bad actors. Ticketmaster, he said, was “hit with three times the amount of bot traffic than we had ever experienced” amid the “unprecedented demand for Taylor Swift tickets.” The bot activity “required us to slow down and even pause our sales. This is what led to a terrible consumer experience that we deeply regret.”

“As we said after the onsale, and I reiterate today, we apologize to the many disappointed fans as well as to Ms. Swift,” he said in the opening remarks. Berchtold also noted some things the service could have done differently “in hindsight,” including “staggering the sales over a longer period of time and doing a better job setting fan expectations for getting tickets.”

In addition to the executives, the committee said witnesses at the hearing will include Jerry Mickelson, CEO of Jam Productions, one of the largest producers of live entertainment, and singer-songwriter Clyde Lawrence.

Lawrence, who has composed music for motion pictures including the Disney+ holiday comedy movie “Noelle,” wrote an opinion piece for The New York Times in December titled “Taylor Swift’s Live Nation Debacle Is Just the Beginning,” in which he criticized Live Nation for allegedly being a monopoly and detrimental to artists.

“Whether it meets the legal definition of a monopoly or not, Live Nation’s control of the live music ecosystem is staggering,” he wrote.

Criticism of Ticketmaster’s dominance dates back decades, but the Swift ticketing incident has once again turned that issue into a dinner table discussion at many households.

Concert promoter Live Nation and ticketing company Ticketmaster, two of the largest companies in the concert business, announced their merger in 2009. The deal at the time raised concerns, including from the US Department of Justice, that it would create a near-monopoly in the industry.

The Justice Department allowed the Live Nation-Ticketmaster merger to proceed despite a 2010 court filing in the case that raised objections to the merger. In the filing, the Justice Department said that Ticketmaster’s share among major concert venues exceeded 80%.

Ticketmaster disputes that market share estimate and says it holds at most just over 30% of the concert market, according to comments on NPR recently by Berchtold.

While irate fans were left scrambling to wade through the Swift ticket confusion, their collective anger caught lawmakers’ attention.

Members of Congress used the debacle to criticize Ticketmaster’s control of the live music industry, saying that because Ticketmaster dominates so heavily, it has no reason to make things better for the millions of customers who have no other choice.

“Ticketmaster’s power in the primary ticket market insulates it from the competitive pressures that typically push companies to innovate and improve their services,” Klobuchar, who chairs the antitrust subcommittee, wrote in an open letter to Ticketmaster’s CEO in November. “That can result in the types of dramatic service failures we saw this week, where consumers are the ones that pay the price.”

Senator Richard Blumenthal echoed Klobuchar’s concerns. He tweeted at the time that the tour “is a perfect example of how the Live Nation/Ticketmaster merger harms consumers by creating a near-monopoly.”

In December, lawmakers from the House Energy and Commerce Committee sent a letter to Live Nation CEO Michael Rapino, demanding a briefing on what went wrong and what steps the company is taking to fix the problems.

“The recent pre-sales ticketing process for Taylor Swift’s upcoming Eras tour – in which millions of fans endured delays, lockouts, and competition with aggressive scammers, scalpers and bots – raises concerns over the potential unfair and deceptive practices that face consumers and eventgoers,” the committee wrote in its letter.

The committee noted it had previously raised concerns about the industry’s business practices and said it wanted to meet with Rapino to discuss how the company processes tickets for concerts and major tours. It also wants answers about how Ticketmaster plans to improve in the future.

Brian A. Marks, a senior lecturer in the department of economics and business analytics at University of New Haven’s Pompea College of Business, said he would have liked Swift to make an appearance at the hearing.

“This hearing seems to be focused on Swift and what happened with the ticket sales. We also have to remember that Taylor Swift and her team negotiated a contract with Ticketmaster for sale of her concert ticket,” said Marks.

“Will Congress want to look at that contract? To me, what happened with the Swift concert tickets was not necessarily the result of Ticketmaster being the dominant player in the industry,” he said. Artists, and especially larger artists like Swift, “are free to elsewhere,” he said. “This point may get missed in tomorrow’s hearing.”

– CNN’s Frank Pallotta, Chris Isidore and David Goldman contributed to this story



Read original article here

Science

Two supermassive black holes, very close together, found by astronomers

Leave a comment

Sign up for CNN’s Wonder Theory science newsletter. Explore the universe with news on fascinating discoveries, scientific advancements and more.



CNN
 — 

Two supermassive black holes have been spotted feasting on cosmic materials as two galaxies in distant space merge — and are the closest to colliding black holes astronomers have ever observed.

Astronomers spotted the pair while using the Atacama Large Millimeter/Submillimeter Array of telescopes, or ALMA, in northern Chile’s Atacama Desert, to observe two merging galaxies about 500 million light-years from Earth.

The two black holes were growing in tandem near the center of the coalescing galaxy resulting from the merger. They met when their host galaxies, known as UGC 4211, collided.

One is 200 million times the mass of our sun, while the other is 125 million times the mass of our sun.

While the black holes themselves aren’t directly visible, both were surrounded by bright clusters of stars and warm, glowing gas — all of which is being tugged by the holes’ gravitational pull.

Over time, they will start circling one another in orbit, eventually crashing into one another and creating one black hole.

After observing them across multiple wavelengths of light, the black holes are located the closest together scientists have ever seen — only about 750 light-years apart, which is relatively close, astronomically speaking.

The results were shared at the 241st meeting of the American Astronomical Society being held this week in Seattle, and published Monday in The Astrophysical Journal Letters.

The distance between the black holes “is fairly close to the limit of what we can detect, which is why this is so exciting,” said study coauthor Chiara Mingarelli, an associate research scientist at the Flatiron Institute’s Center for Computational Astrophysics in New York City, in a statement.

Galactic mergers are more common in the distant universe, which makes them harder to see using Earth-based telescopes. But ALMA’s sensitivity was able to observe even their active galactic nuclei — the bright, compact regions in galaxies where matter swirls around black holes. Astronomers were surprised to find a binary pair of black holes, rather than a single black hole, dining on the gas and dust stirred up by the galactic merger.

“Our study has identified one of the closest pairs of black holes in a galaxy merger, and because we know that galaxy mergers are much more common in the distant Universe, these black hole binaries too may be much more common than previously thought,” said lead study author Michael Koss, a senior research scientist at the Eureka Scientific research institute in Oakland, California, in a statement.

“What we’ve just studied is a source in the very final stage of collision, so what we’re seeing presages that merger and also gives us insight into the connection between black holes merging and growing and eventually producing gravitational waves,” Koss said.

If pairs of black holes — as well as merging galaxies that lead to their creation — are more common in the universe than previously thought, they could have implications for future gravitational wave research. Gravitational waves, or ripples in space time, are created when black holes collide.

It will still take a few hundred million years for this particular pair of black holes to collide, but the insights gained from this observation could help scientists better estimate how many pairs of black holes are close to colliding in the universe.

“​​There might be many pairs of growing supermassive black holes in the centers of galaxies that we have not been able to identify so far,” said study coauthor Ezequiel Treister, an astronomer at Universidad Católica de Chile in Santiago, Chile, in a statement. “If this is the case, in the near future we will be observing frequent gravitational wave events caused by the mergers of these objects across the Universe.”

Space-based telescopes like Hubble and the Chandra X-ray Observatory and ground-based telescopes like the European Southern Observatory’s Very Large Telescope, also in the Atacama Desert, and the W.M. Keck telescope in Hawaii have also observed UGC 4211 across different wavelengths of light to provide a more detailed overview and differentiate between the two black holes.

“Each wavelength tells a different part of the story,” Treister said. “All of these data together have given us a clearer picture of how galaxies such as our own turned out to be the way they are, and what they will become in the future.”

Understanding more about the end stages of galaxy mergers could provide more insight about what will happen when our Milky Way galaxy collides with the Andromeda galaxy in about 4.5 billion years.

Read original article here

Business

Elon Musk’s Twitter plans may take inspiration from Chinese super apps

Leave a comment

Elon Musk’s revived $44 billion deal to buy Twitter sparked fresh debate over what the billionaire will do with the service if he eventually owns it.

On Tuesday, Musk tweeted that buying Twitter is an “accelerant to creating X, the everything app.” He did not provide further details.

Musk may be hinting toward so-called “super apps” which are popular in China and other parts of Asia and pioneered by the likes of Chinese technology giant Tencent.

Super apps is a term to describe an app that often acts as a one-stop shop for all your mobile needs. For example, you might order a taxi or food via the app and at the same time do payments and messaging. This eliminates the need to have multiple apps for different functions.

Chinese app WeChat, run by Tencent, is the biggest super app in the world, with over a billion users.

In WeChat, users can message people, do mobile banking, pay for things online or in store by scanning a barcode, play games, post videos, do online shopping, hail a car and many other things.

When Musk talks about “the everything app,” he could be thinking about WeChat.

The Tesla CEO has previously expressed admiration for WeChat calling the app “great” during a town hall with Twitter employees in June. Musk said there is no WeChat equivalent outside of China.

“And I think that there’s a real opportunity to create that,” Musk told employees. “You basically live on WeChat in China because it’s so useful and so helpful to your daily life. And I think if we could achieve that, or even close to that with Twitter, it would be an immense success.”

Musk said that he wants at least a billion people using Twitter, up from 237.8 million at the end of the second quarter.

Tencent runs the ubiquitous Chinese messaging app WeChat. The company has a short form video feature with in the app and has began to monetize that through video ads in the feed. Tencent said such ads could become a “substantial” source of revenue in the future.

Budrul Chukrut | Sopa Images | Lightrocket | Getty Images

One of WeChat’s biggest features is WeChat Pay. This is a feature where users can scan a barcode in a store to pay via their mobile or they can send money to friends via the chat function. WeChat Pay can also be used for purchases online.

Musk said during the town hall that he thinks that payments within Twitter would be an “interesting thing to do.”

However, super apps like WeChat haven’t really taken off in a big way in Europe, the U.S. and other western markets.

WeChat meanwhile is heavily censored in China, something Musk is unlikely to do with Twitter, given his past criticisms of the platform’s content moderation strategy which the billionaire feels has stifled free speech.

Read original article here

Business

BofA predicts breakout in mergers due to downcycle

Leave a comment

Mergers in software may be about to break out.

Top investment banker Rick Sherlund of Bank of America sees a wave of struggling companies putting themselves up for sale at cheaper prices due to the economic downturn.

related investing news

Ray Dalio says higher interest rates to squash inflation could tank stock prices by 20%

“You do need to see greater capitulation,” the firm’s vice chair of technology investment banking told CNBC’s “Fast Money” on Thursday. “Companies will have their valuation expectations soften, and that will combine with more fully functional financial markets. I think it will accelerate the pace of M&A [mergers and acquisitions].”

His broad analysis comes on the heels of Adobe’s $20 billion dollar deal Thursday for design platform Figma. Adobe failed to generate excitement on Wall Street. Its shares plunged 17% due to questions about the price tag.

Sherlund, a former software analyst who hit No. 1 on Institutional Investor’s all-star analyst list 17 times in a row, worked at Goldman Sachs during the 2000 tech bubble. He believes the Street is now in the beginning stages of a difficult market cycle.

“You need to get through third quarter earnings reports to feel confident that maybe the bad news is largely out into the market because companies will be reporting lengthening of sales cycles,” he said. “We need to reset expectations for 2023.”

Read more about tech and crypto from CNBC Pro

Sherlund and his team are very active in the M&A market.

“You have private equity with a boatload of cash, and they need functioning debt markets for leverage to do deals,” Sherlund noted. “They’re very eager and actively looking at this sector … It suggests that [for] M&A, in absence of an IPO market, we’re just going to see a lot more consolidation coming in the sector.”

He notes the IPO has been hurt in connection with rising interest rate headwinds and inflation.

“[The IPO market] is not open. But when the window does open back up, you are going to see a lot of companies going public,” he added.

The long-term prospects for software are extremely attractive, according to Sherlund.

“You’ve got to be very bullish on the long-term fundamentals of the sector,” Sherlund said. “Every company is becoming a digital enterprise.”

Disclaimer

Read original article here

Business

Shares of Assassin’s Creed maker Ubisoft plunge after Tencent ups stake

Leave a comment

Tencent has increased its stake in French games maker Ubisoft, the company behind popular franchises like Assassin’s Creed. But analysts said this has effectively closed the door on a full takeover of the company.

Rafael Henrique | Sopa Images | Lightrocket | Getty Images

Shares of games developer Ubisoft plunged more than 16% on Wednesday after prospects of a full takeover were dampened following a move by Chinese tech giant Tencent to increase its stake in the company.

On Tuesday, the two companies announced that Tencent invested 300 million euros ($296.9 million) in Guillemot Brothers Limited, amounting to a 49.9% stake in the company. Tencent only gets 5% voting rights in the company.

Guillemot Brothers Limited is controlled by the Guillemot family, and is the entity that controls the majority of the family’s roughly 15% stake in Ubisoft.

The Guillemot brothers founded Ubisoft in 1986 and have fought hard to keep the company independent and protected from a takeover.

Tencent’s investment values Ubisoft shares at 80 euros each, an 83% premium on Tuesday’s closing price and gives it an indirect stake in the French games developer.

The move effectively closes the door on a full takeover of Ubisoft by any party, according to analysts, something that investors were holding out for.

“What this transaction does appear to signal is that any full sale of Ubisoft to a strategic or financial buyer is very unlikely. In our view this should be seen as a net negative for shares (though not for the company itself),” analysts at Cowen said in a note Tuesday.

As part of the deal, Tencent is able to increase its direct stake in Ubisoft from 4.5% currently to 9.99% of the capital or voting rights. But Tencent will not be able to sell its shares for five years and will not be able to increase its stake in Ubisoft beyond 9.99% for a period of eight years. That effectively rules out a complete takeover of the gaming firm.

Ubisoft’s drama began in 2015 when French media conglomerate Vivendi took a stake in the European gaming firm, eventually becoming its biggest shareholder. But the Guillemot family were determined to keep the company independent.

In 2018, after a three-year battle, Vivendi dropped its pursuit of Ubisoft. Tencent stepped in to buy some of the Ubisoft shares Vivendi offloaded and the Chinese tech giant ended up owning a 5% stake in the games company.

Ubisoft has faced a number of challenges including sexual harassment allegations and a lack of new hit titles.

Tencent’s investment continues a flurry of deals in the video games space this year, particularly from Asian firms, that began with Microsoft’s proposed $68.7 billion acquisition of Activision Blizzard in January followed by Sony’s takeover of Bungie, the maker of hit games Halo and Destiny.

Tencent, based in Shenzhen, China, has grown into one of the world’s largest gaming companies over the years, through acquisitions of and investments in smaller studios with popular global titles including League of Legends maker Riot Games, for example.

Tougher regulation around gaming in China has pushed Tencent and its rival NetEase to expand overseas through investments and acquisitions.

Ubisoft is known for some popular franchises including Assassin’s Creed and Rainbow Six. Ubisoft scheduled an event for Saturday to reveal details about upcoming games.

Tencent has typically helped companies it has invested in to run independently, but offered a hand to expand titles into China and onto mobile, where it has typically been strong.

Martin Lau, president of Tencent, said that the two companies will continue “to develop immersive game experiences” and bring Ubisoft’s most well-known franchises to mobile.

Read original article here

Business

Elon Musk Adds a New Twist to the Twitter Saga

Leave a comment

Elon Musk versus Twitter  (TWTR) – Get Twitter Inc. Report: It’s a battle royale.

It’s a battle of titans that will have important consequences for mergers and acquisitions in the future. 

The world’s richest man and CEO of Tesla  (TSLA) – Get Tesla Inc. Report abruptly withdrew his $44 billion bid to acquire the microblogging website he defines as the Town Square of our time. Twitter took legal action to get Musk to honor his commitment. It is therefore no surprise that the two adversaries are bringing out heavy artillery to destabilize the other. The battle is primarily mental. They must send messages to the opponent to show them that they are ready to do anything to inflict blows that would prevent them from getting up.

Twitter Wants a Trial by mid-September

It was Twitter that struck the first blow by filing its lawsuit on July 12, just three days after Musk’s withdrawal, in Delaware Chancery Court. And in this document, the platform used the whimsical entrepreneur’s own tweets. The icing on the cake, the social network is asking justice for a quick trial. 

The platform requests that the trial be held in mid-September  because the merger agreement between the two parties provides that if it is not finalized before October 24, each of the two parties can terminate it free of charge.

“Defendants’ ability to terminate the agreement before the presumptive drop-dead date of Oct. 24, 2022 is extremely limited and carefully circumscribed,” Twitter said in its lawsuit that you can find here. “There is no right for defendants to terminate unless there is a breach sufficiently significant to cause failure of a closing condition, which, after due notice, is either incapable of being cured or is not cured within 30 days after such notice.”

“Twitter has suffered and will continue to suffer irreparable harm as a result of defendants’ breaches,” the platform alleged.

Musk Wants the Trial to Start in 2023

Musk didn’t respond right away. The billionaire let a few days pass and has just gone on the counterattack. In their response to Twitter’s complaint, Musk’s attorneys are asking that the trial not be held until Feb. 13, 2023 at the earliest.

“Plaintiff’s proposed schedule would severely prejudice defendants by depriving them of a meaningful opportunity to take discovery, conduct expert analysis, and present their case,” lawyers of the billionaire wrote in their motion that you can read in its entirety here.

Scroll to Continue

“The only relevant date is the outside date for the debt financing, April 25, 2023. Accordingly, defendants respectfully request trial on or after February 13, 2023, an extremely rapid schedule for a case of this enormous magnitude that provides the court time for reasoned adjudication before the true outside date,” they argued.

In his letter withdrawing his proposed acquisition of Twitter, Musk accused the management of the social network of having lied about the number of spam bots or fake accounts present on the platform. Twitter has always estimated that fake accounts represent less than 5% of its users. Musk estimates that figure to be at least 20%.

“The core dispute over false and spam accounts is fundamental to Twitter’s value. It is also extremely fact and expert intensive, requiring substantial time for discovery. Twitter is a social media platform whose self-professed key performance metric is monetizable daily active users (“mDAU”),” Musk’s team said in their 16-page motion filed on July 15.

They continued:

“Extreme expedition is also unwarranted because any exigency stems from plaintiff’s strategic delay,” the billionaire’s team said. “Had Twitter either promptly complied with its contractual obligations or informed defendants that it would not, this dispute would have ripened in early May.”

“Plaintiff’s attempt to impose “the burdens of expedited proceedings upon the defendants and the court cannot be reconciled with [its] failure to proceed with alacrity.”

A hearing is scheduled before a judge on July 19. This hearing will decide when the trial will be held.

On a more relaxed note, the mogul feels that Twitter lacks humor.

“With the sense of humor of a bot, Twitter claims that Musk is damaging the company with tweets like a Chuck Norris meme and a poop emoji. Twitter ignores that Musk is its second largest shareholder with a far greater economic stake than the entire Twitter board,” Musk’s lawyers said.



Read original article here

Business

Bill Ackman to wind up SPAC, return $4 billion to investors

Leave a comment

Bill Ackman during a Bloomberg Television interview on 1 November 2017. Billionaire investor William Ackman, who had raised $4 billion in the biggest-ever special purpose acquisition company (SPAC), told investors he would be returning the sum after failing to find a suitable target company to take public through a merger.

Christopher Goodney | Bloomberg | Getty Images

Billionaire investor William Ackman, who had raised $4 billion in the biggest-ever special purpose acquisition company (SPAC), told investors he would be returning the sum after failing to find a suitable target company to take public through a merger.

The development is a major setback for the prominent hedge fund manager who had initially planned for the SPAC to take a stake in Universal Music Group last year when these investment vehicles were all the rage on Wall Street.

In a letter sent to shareholders on Monday, Ackman highlighted numerous factors, including adverse market conditions and strong competition from traditional initial public offerings (IPOs), that thwarted his efforts to find a suitable company to merge his SPAC with.

“High quality and profitable durable growth companies can generally postpone their timing to go public until market conditions are more favorable, which limited the universe of high-quality possible deals for PSTH, particularly during the last 12 months,” said Ackman, referring to the ticker symbol for his SPAC.

In July 2020, Pershing Square Tontine raised $4 billion in its initial public offering and wooed prominent investors ranging from hedge fund Baupost Group, Canadian pension fund Ontario Teachers and mutual fund company T. Rowe Price Group.

Stock picks and investing trends from CNBC Pro:

SPACs, also known as blank-check companies, are publicly-listed shells of cash that are created by large investors — known as sponsors — for the sole purpose of merging with a private company. The process, which is similar to a reverse merger, takes the target company public.

SPACs peaked during 2020 and the early part of 2021, helping rake in paper gains worth hundreds of millions of dollars for a number of prominent SPAC creators like Michael Klein and Chamath Palihapitiya.

However, over the past year, companies that merged with SPACs have performed poorly, forcing investors to shun blank-check deals. That coupled with tighter regulatory scrutiny and a downturn in equity markets have practically shut down the SPAC economy, with several billions of dollars at stake.

Moreover, the record-breaking performance of regular IPOs in the United States in 2021 posed competitive challenges for SPAC sponsors like Ackman, as several richly valued startups chose to list their shares on exchanges through traditional routes instead.

“The rapid recovery of the capital markets and our economy were good for America but unfortunate for PSTH, as it made the conventional IPO market a strong competitor and a preferred alternative for high-quality businesses seeking to go public,” Ackman said.

In July last year, Ackman’s efforts to take a 10% stake in Universal Music, which was being spun off by French media conglomerate Vivendi, through his SPAC were derailed due to regulatory hurdles. The U.S. Securities and Exchange Commission objected to the deal and Ackman put the investment into his hedge fund instead.

“While there were transactions that were potentially actionable for PSTH during the past year, none of them met our investment criteria,” Ackman said.

Read original article here

Business

Panera Bread terminates SPAC deal with Danny Meyer’s investment group

Leave a comment

Florida, Spring Hill, Nature Coast Commons, shopping mall, Panera Bread bakery.

Jeff Greenberg | Universal Images Group | Getty Images

Danny Meyer’s SPAC and Panera Bread have called off a deal to take the sandwich chain public again, citing market conditions.

In November, the parent company of the sandwich chain, Caribou Coffee and Einstein Bros. Bagels announced it was preparing to go public and had secured an investment from USHG Acquisition, Meyer’s special purpose acquisition company.

It was an unusual deal for a SPAC, which typically uses bank financing and the proceeds from an initial public offering to take privately held companies public. The planned arrangement would have exchanged shares of USHG Acquisition for the sandwich chain’s stock and allowed the company to survive a merger with Panera’s subsidiary Rye Merger.

At the time of the deal, SPACs were still booming, backed by eager investors who liked their accessibility, and the broader market was still riding high. But high-profile busts and the threat of regulation have made SPACs less popular, while the war in Ukraine, soaring inflation and recession fears have deferred many companies’ hopes for going public.

The merger had to be completed by Thursday, otherwise either party could terminate the deal. On Friday, Panera delivered written notice to USHG that it would end the agreement after passing the deadline, according to a regulatory filing.

“Based on current capital market conditions, it is unlikely that an initial public offering for Panera will happen in the near-term, and so we have agreed not to extend our partnership beyond its existing June 30 expiration date,” Meyer said in a statement.

The Shake Shack founder added that his SPAC will keep looking for investments.

Panera went private in 2017 after JAB Holding bought the company for $7.5 billion. As a privately held company, the chain has kept investing in technology, boosting its digital sales and maintaining its reputation as a leader in the restaurant industry.

The termination of the deal is a blow to JAB, which has been trimming its portfolio over the last year. The company, which is the investment arm of the Reimann family, sold Au Bon Pain to a Yum Brands franchisee last June. Under JAB’s ownership, many Au Bon Pain locations were converted into Panera restaurants, shrinking its footprint from roughly 300 locations to 171. Then, in July, Krispy Kreme went public again after being owned by JAB since 2016.

Read original article here

World

These are the 2022 CNBC Disruptor 50 companies

Leave a comment

In the tenth annual Disruptor 50 list, CNBC highlights private companies that grew through the ups and downs of the pandemic and are poised to meet increasing economic and consumer challenges.

All told, these firms have raised a half-trillion dollars in venture capital. At least 41 are unicorns, with valuations of $1 billion or more – 14 are valued at over $10 billion. But becoming a unicorn has become all too common, and as market volatility pressures valuations in both public and private markets, other stats stand out: 

Forty of the companies have a social or environmental purpose that is core to their business model. Ten of this year’s Disruptors are from the logistics sector, tackling the broken global supply chain that has fueled four-decade high inflation. Eight are reducing costs in a bloated health-care system and reaching underserved populations. Several more are dedicated to the climate crisis. Nine of this year’s Disruptors have a female founder. Sixteen feature CEOs from racial and ethnic minorities.  

The 50 companies selected using the proprietary Disruptor 50 methodology have raised over $56 billion in venture capital, according to PitchBook, at an implied Disruptor 50 valuation of more than $552 billion.

Read original article here

Business

Elon Musk Has a Fascinating Idea to Make Money on Twitter

Leave a comment

Elon Musk hears criticism and never hesitates to respond to it. 

Like a boxer taking the blows of his opponent in the first rounds of a boxing match, the billionaire tends to have phases of observation. He observes his opponents to try to find their weakness before striking the fatal blow.

The whimsical CEO of Tesla  (TSLA) – Get Tesla Inc Report has made a takeover bid of $44 billion, or $54.20 per Twitter  (TWTR) – Get Twitter, Inc. Report share, to buy the social network which he describes as the “de facto town square” of the internet.

Musk explains that his decision is motivated by the desire to restore the principles of free speech on the platform. The deal has alarmed Democrats who say they fear the world’s richest man will handle the platform to conservatives, and especially extremist and far right voices. They also say they fear an explosion of hate speech in the name of free speech.

New Funding?

Musk has so far said that his Twitter will tolerate comments that fall within the legal scope and respect current legislation in each country where the social network operates. Basically, as long as something doesn’t break the law, it will be accepted on Twitter.

The transaction also raises questions about its financing. The billionaire managed to secure $46.5 billion in loan from banks and margin loan guaranteed by his Tesla shares. And this part which represents $21 billion is the one on which all eyes are currently focused. Musk, who sold millions of Tesla shares for just over $8.5 billion, wants to reduce this cash contribution tied to his personal wealth, according to Reuters.

The new financing could come in the form of preferred or common equity. Musk is trying to convince certain major shareholders of Twitter, hedge funds and wealthy individuals to provide preferred equity financing for the acquisition.

The billionaire is also trying to convince some shareholders not to sell their shares as part of the offer but to remain shareholders of the group even when it will be delisted.

Jack Dorsey, the founder and former CEO of Twitter, is among the shareholders Musk reportedly told about his plans. 

Scroll to Continue

Musk himself seemed to confirm this information by commenting on a Twitter post that mentioned the Reuters story.

“Also, as mentioned before, we will try to keep as many shareholders as legally possible in privately held Twitter!” said the billionaire whose net wealth is estimated at $258 billion as of May 3, according to the Bloomberg Billionaires Index.

A Fee for Commercial/Government Users

Beyond funding, the other question that many observers are asking is what economic model Musk intends to adopt for Twitter? The tycoon had mentioned the idea of ​​removing advertising from the platform, and in particular for subscribers to Blue, a subscription service offered by Twitter that gives users access to premium features, like the ability to cancel a Tweet. These features are available wherever you use the Twitter account from which you subscribed.

“Everyone who signs up for Twitter Blue (ie pays $3/month) should get an authentication checkmark,” Musk suggested on April 9, referring to one of the new products. “Blue already has a modifiable 20 second time to edit tweet feature,” he added.

Musk has just unveiled the first ideas of the economic model he intends to put in place once he has finalized the acquisition of Twitter in October if all goes as planned. The entrepreneur indicates that the platform will remain free for ordinary users. But on the other hand, Twitter will charge a slight fee for businesses, companies and government users.

“Twitter will always be free for casual users,” Musk told his more than 90 million followers on Twitter on May 3. “But maybe a slight cost for commercial/government users.”

The billionaire did not give further details: How much will this slight cost be ? Who falls into the government category?

Twitter Blue currently costs $2.99 per month. However, Twitter mainly derives its revenue from advertising.

Much speculation currently surrounds Musk’s intentions regarding Twitter. The Wall Street Journal just reported that the mogul intends to to take the firm public again with an IPO within the next three years.



Read original article here