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☆ Activist Investor’s Group Raises Bid for Macy’s
▼ + stars: | 2024-03-03 | by ( Lauren Hirsch | Jordyn Holman | ) www.nytimes.com time to read: +1 min

The activist investor group that is seeking to buy Macy’s increased the pressure on the department store chain on Sunday, raising its offer and disclosing additional details about its financing plans. Arkhouse Management and Brigade Capital Management said in a news release that they were now offering $24 per share, valuing the retailer at $6.6 billion. The new offer is up from the $21 a share they last put forward and a 33.3 percent premium to Macy’s closing share price of at $18.01 on Friday. Arkhouse and Brigade named additional investors they had brought on as equity partners, Fortress Investment Group and One Investment Management. The investor has since nominated nine people to Macy’s board.

Persons: Arkhouse Organizations: Arkhouse Management, Brigade Capital Management, Brigade, Fortress Investment Group, One Investment Management Locations: Macy’s

From Silicon Valley to Wall Street to Washington, the blockbuster case that Elon Musk filed against OpenAI and its C.E.O., Sam Altman, has become Topic A. It is the business world’s hottest soap opera. But among lawyers, the case has become something of a fascination for a different reason: It poses a series of unique and unusual legal questions without clear precedent. And it remains unclear what would constitute “winning” in a case like this, given that it appears to have been brought out of Musk’s own personal frustration and philosophical differences with Open A.I, a company he helped found and then left. The lawsuit — which pits one of the wealthiest men in the world against the most advanced A.I.

Persons: Elon Musk, Sam Altman, OpenAI, —, Morgan Chu Organizations: OpenAI, Microsoft Locations: Silicon, Washington

Musk takes aim at OpenAIThe gloves have really come off in one of the most personal fights in the tech world: Elon Musk has sued OpenAI and its C.E.O., Sam Altman, accusing them of reneging on the start-up’s original purpose of being a nonprofit laboratory for the technology. Yes, Musk has disagreed with Altman for years about the purpose of the organization they co-founded and he is creating a rival artificial intelligence company. But the lawsuit also appears rooted in philosophical differences that go to the heart of who controls a hugely transformative technology — and is backed by one of the wealthiest men on the planet. The backstory: Musk, Altman and others agreed to create OpenAI in 2015 to provide an open-sourced alternative to the likes of Google, which had bought the leading A.I. start-up DeepMind the year before.

Persons: Elon Musk, OpenAI, Sam Altman, Musk, Altman, Ilya Sutskever Organizations: Google

More questions for OpenAISam Altman has been back as OpenAI’s C.E.O. for three months, running one of the world’s most important tech companies at the forefront of the artificial intelligence boom. But a report by The Wall Street Journal that the S.E.C. is investigating whether Altman misled investors is a reminder that OpenAI and its hyper-ambitious chief face a level of scrutiny that could dent their global plans. isn’t the only regulator looking at the Altman drama: Federal prosecutors in Manhattan have also been asking questions, according to The Journal.

Persons: OpenAI Sam Altman, Altman, Altman’s Organizations: Wall Street Journal Locations: Manhattan

Innovation on wheelsHas Apple really crashed the car? The tech giant has killed its electric vehicle project as it pivots to artificial intelligence, prompting many observers to declare the venture a major failure for the company. Here’s a contrarian thought: That critique misses a wider point about how Apple innovates, because the company has used the project to power a whole ecosystem of products and services that have been unmitigated successes. Reports emerged about the secret effort, code-named Project Titan, in 2014, and the company has never publicly acknowledged its existence. There had been an wider internal debate about getting into the car business.

Organizations: Apple

So the White House probably cheered a move by the F.T.C. and several states on Monday to block Kroger’s $25 billion bid to buy Albertsons, arguing that the biggest supermarket merger in U.S. history would raise prices and hit union workers’ bargaining power. The Biden administration has little influence over inflation, but it’s still getting heat. Consumers are spending the highest proportion of their income on food in 30 years, and an internal White House analysis found that grocery prices had the biggest impact on consumer sentiment. The Fed has jacked up interest rates to a 20-year-high in an effort to cool inflation, but progress on that has slowed in recent months.

Persons: Biden’s, Biden, it’s Organizations: Kroger, Albertsons Locations: U.S

Toeing the line in Miami BeachAmerica’s corporate elite were everywhere in Miami at the Future Investment Initiative conference, Saudi Arabia’s latest bid to showcase its extensive wealth and deepen ties with Western business. DealBook’s Lauren Hirsch was on hand to report on the financiers and Hollywood A-listers who made the trip. The Saudis are using their vast oil wealth to become one the world’s biggest investors and forge closer relationships with Wall Street, Silicon Valley and more. (So too did former Trump officials including Steven Mnuchin, the former Treasury secretary; Mike Pompeo, a previous secretary of state; and Jared Kushner, Trump’s son-in-law.) Attendees mingled over wine, which is banned in Saudi Arabia, and Carbone’s spicy rigatoni.

Persons: Jamal Khashoggi —, Prince Mohammed bin Salman, DealBook’s Lauren Hirsch, Steve Schwarzman, Blackstone, Barry Sternlicht, Alex Karp, Brian Grazer, Gwyneth Paltrow, Steven Mnuchin, Mike Pompeo, Jared Kushner, Trump’s Organizations: Future Investment Initiative, Saudi, Hollywood, Starwood, Palantir, Trump, Treasury Locations: Miami Beach, Miami, Silicon Valley, Saudi Arabia

ImageReddit’s bet on RedditorsReddit is the latest company set to test the uncertain I.P.O. market, after the unprofitable social media company built around an avid community of newshounds, cryptocurrency devotees and reality TV fans filed to go public. The company is seeking a valuation of at least $5 billion and DealBook sifted through its prospectus to figure out its pitch to investors. demand that’s fueling a global stock market rally. But whether that’s enough to push Reddit to become profitable is a big question hanging over the listing.

Persons: Reddit, Google that’s Organizations: Google Locations: newshounds, A.I

supercycleFor now, Nvidia is living up to the lofty title that Goldman Sachs bestowed on it this week — “the most important stock on planet Earth” — after its blowout earnings report. Markets are looking up today, as are investors’ and governments’ hopes for the artificial intelligence boom, as strong demand for the chipmaker’s products suggest that there’s more room for the trend to run. Nvidia is up 13 percent in premarket trading after results that surpassed high analyst expectations (and spurred a torrent of exuberant memes). Jensen Huang, the company’s C.E.O., said that Nvidia was seeing a “tipping point” in demand for A.I.

Persons: Goldman Sachs, ’, Jensen Huang Organizations: Nvidia

Investors brace for “fireworks”The stock price of the chip giant Nvidia has marched steadily higher over the past year and a half, propelled by investors’ hopes that artificial intelligence is truly transformative technology — and by their hope that the company’s high-end semiconductors will continue to power that technology. But in recent days, the company became the third most valuable listed company in the U.S., only to slump back to fifth. Its shares will face another big test on Wednesday, when Nvidia announces its latest quarterly earnings, with billions in investor capital on the line. After seeing the stock more than double since May on the back of huge demand for Nvidia’s chips, investors are wondering if it’s close to peaking. Opinion on Wall Street appears divided: Bloomberg reports that options traders have piled into both put options, whose value rises as a stock’s price falls, and call options.

Persons: ’, Brace, ” Jim Reid Organizations: Nvidia, Bloomberg, Deutsche Bank Locations: U.S

Challenges, and opportunities, for a financial megadealCapital One’s $35.3 billion takeover to buy Discover Financial Services will create a colossus in the fast-growing credit card industry and a more powerful force in the payment networks that underpin the consumer economy. That will almost surely invite tough scrutiny from a Washington that is increasingly skeptical of big financial mergers. But continuing scrutiny of the two biggest payment networks in the U.S., Visa and Mastercard, may complicate the regulatory math. The deal: Capital One agreed to pay 1.0192 of its shares for each share of Discover, a roughly 26 percent premium to Friday’s trading prices. If completed, the transaction would become a giant among credit card lenders, with Bloomberg estimating that the combined company would outstrip JPMorgan Chase and Citigroup in U.S. card loan volume.

Organizations: Discover Financial, Visa, Mastercard, Capital, Bloomberg, JPMorgan Chase, Citigroup, U.S Locations: Washington, U.S

☆ Capital One to Acquire Discover, Creating a Consumer Lending Colossus
▼ + stars: | 2024-02-19 | by ( Lauren Hirsch | Emma Goldberg | ) www.nytimes.com time to read: +1 min

Capital One announced on Monday that it would acquire Discover Financial Services in an all-stock transaction valued at $35.3 billion, a deal that would merge two of the largest credit card companies in the United States. “A space that is already dominated by a relatively small number of megaplayers is about to get a little smaller,” said Matt Schulz, chief credit analyst at LendingTree. Capital One, with $479 billion in assets, is one of the nation’s largest banks, and it issues credit cards on networks run by Visa and Mastercard. Acquiring Discover will give it access to a credit card network of 305 million cardholders, adding to its base of more than 100 million customers. The country’s four major networks are American Express, Mastercard, Visa and Discover, which has far fewer cardholders than its competitors.

Persons: ”, Matt Schulz, Jesse Van Tol Organizations: Discover Financial Services, LendingTree, Visa, Mastercard, Discover, American Express, National Community Reinvestment Coalition Locations: United States

But few foresaw JPMorgan Chase and State Street quitting Climate Action 100+, a global investment coalition that has been pushing companies to decarbonize. All told, the moves amount to a nearly $14 trillion exit from an organization meant to marshal Wall Street’s clout to expand the climate agenda. Representative Jim Jordan, the Ohio Republican who compared the coalition to a “cartel” forcing businesses to cut emissions, called for more financial companies to follow suit. JPMorgan said it had built an in-house sustainable investment team to focus on green issues. And BlackRock will maintain some ties to the coalition: It has transferred its membership to an international entity.

Persons: Wall, Jim Jordan, Brad Lander, they’re Organizations: JPMorgan Chase, State, Ohio Republican, JPMorgan Locations: BlackRock, Brad Lander , New York

Elon Musk continues his flight from “the First State”Another Elon Musk-led company has moved its home base from Delaware as the tech billionaire continues to criticize the state after a judge there voided his nearly $56 billion payday at Tesla. Moving the incorporation of SpaceX, Musk’s privately held rocket giant, to Texas will help bolster the Lone Star State’s standing with business. Musk is making good on his threat to pull out of the state. It comes shortly after he relocated the incorporation of Neuralink, his brain implant company, to Nevada. Musk endorsed that view, writing that having a Delaware incorporation is a “guarantee of spurious litigation.”

Persons: Elon Musk, Elon, Musk’s, Tesla, ” Organizations: Tesla, SpaceX, Lone Star Locations: Delaware, Texas, Neuralink, Nevada, America

“No landing”Markets are still on edge after Tuesday’s hot inflation report, as Wall Street suddenly and sharply discounted the odds of imminent interest rate cuts. It has also poured cold water on the belief among many investors that the U.S. economy will achieve a “soft landing.”Why so gloomy? The Consumer Price Index report, which came in above economists’ forecasts, is a stark reminder of the challenges that the Fed faces in bringing down inflation to its 2 percent target. Even after excluding volatile energy and food prices, inflation is holding roughly steady and is well above where the central bank feels comfortable. Shelter costs, including rents, also rose above expectations, and “supercore inflation,” a measure the Fed closely follows that includes common “services” expenditures — like haircuts and lawyer fees — rose 4.3 year-on-year, its highest level since May, according to Deutsche Bank data.

Organizations: Deutsche Bank Locations: U.S

Inflation back in the spotlightAn S&P 500 on a five-week winning streak. And growing consumer and business optimism. Cooling inflation, which would stoke investor hopes that the Fed would soon lower borrowing costs. The prospects of that economic ideal will be tested on Tuesday with the release of fresh Consumer Price Index data. reading of 2.9 percent for January on an annualized basis, its smallest gain since April 2021.

Persons: it’s Organizations: Fed Locations: U.S

scores bigIn many ways, the N.F.L. couldn’t have asked for a better outcome for the Super Bowl. The game was a place to see and be seen. Yes, Swift arrived in time from Japan to cheer on her boyfriend, the Chiefs star Travis Kelce. And A-list celebrities like Jay-Z, Beyoncé and LeBron James were spotted at Allegiant Stadium in Las Vegas.

Persons: couldn’t, Usher, Taylor Swift, Swift, Travis Kelce, Jay, LeBron James, Elon Musk —, Tim Cook, Jack Dorsey Organizations: Super, Kansas City Chiefs, Chiefs, Elon, Apple, Twitter Locations: Japan, Las Vegas

☆ Tiger Woods Introduces His New Brand: Sun Day Red
▼ + stars: | 2024-02-12 | by ( Lauren Hirsch | Vanessa Friedman | ) www.nytimes.com time to read: +1 min

For even those who have only a passing interest in golf, one of the sport’s most memorable images is of Tiger Woods playing his way to another major tournament victory while wearing a red polo shirt with a white Nike swoosh. In January, Mr. Woods announced the end of his 27-year deal with Nike, which had made him hundreds of millions of dollars. The partnership was marked by memorable ads and, of course, the red Nike shirts that Mr. Woods wore during many final rounds on Sundays. It will be stitched with a tiger in the center, the logo for his new brand under TaylorMade: Sun Day Red. (Mr. Woods switched to FootJoy shoes from Nike after his car crash in 2021.)

Persons: Tiger Woods, Woods, ”, David Abeles Organizations: Nike, Mr, Sun

The biggest upcoming football event for many of the N.F.L. owners and business executives who will populate luxury boxes at the Super Bowl this weekend is not, perhaps surprisingly, the game. It actually won’t take place until six weeks later, in Orlando, Fla., when football executives gather for the National Football League’s annual meeting — an event that has particular significance this year. Major League Baseball, the National Basketball Association and the National Hockey League have already relaxed their ownership rules. But the N.F.L.

Persons: Arthur Blank, Greg Penner Organizations: National Football, Major League Baseball, National Basketball Association, National Hockey League, Atlanta Falcons, Home Depot, Walmart, Denver Broncos Locations: Orlando, Fla, Florida

In the past 24 hours, President Biden has taken questions (and heat) on his age, memory and mental fitness. Big questions still hang over the law, which many Americans appear not to know exists. And can the law survive a potential Trump second term? One reason: There’s huge demand for the credits and subsidies created by the law for building solar, hydrogen and nuclear energy projects, as well as discounts for buying electric vehicles. (An analysis by Goldman Sachs last fall showed that the law led to about $282 billion in investment and roughly 175,000 jobs in its first year.)

Persons: Biden, Goldman Sachs Organizations: Trump, Congressional, Office

Shares in Disney are up more than 7 percent in premarket trading on Thursday, after the entertainment giant released blockbuster quarterly earnings and made a string of headline-grabbing announcements. (Taylor Swift! In short, the House of Mouse bolstered its case against the activist investor Nelson Peltz, who is seeking two board seats. The question is whether that will be enough to definitively fend off the financier. The company also broke with precedent by giving profit guidance, forecasting that its full-year per-share earnings would increase at least 20 percent compared with 2023.

Persons: Taylor Swift, Nelson Peltz, Disney Organizations: Disney

WeWork’s founder is trying to buy itAdam Neumann shot to fame by turning WeWork into a cultural and business phenomenon, before being ousted from the work space operator in dramatic fashion. But for the past several months, he has been trying to buy the now-bankrupt business — with the help of the hedge fund mogul Dan Loeb, DealBook is the first to report. Neumann’s new real estate company Flow Global is pushing WeWork to consider its takeover approach, according to a letter his lawyers sent to WeWork’s advisers on Monday. Flow which has already raised $350 million from the venture capital firm Andreessen Horowitz, disclosed in the letter that Loeb’s Third Point would help finance a transaction. Flow has sought to buy WeWork or its assets, as well as provide bankruptcy financing to keep it afloat.

Persons: Adam Neumann, Dan Loeb, DealBook, Andreessen Horowitz Organizations: Flow

Official figures show that growth is solid, jobs are plentiful and wages are climbing, and yet voters are mostly feeling down and giving President Biden little credit. Friday’s jobs data is adding to that split-screen view, with economists pointing out red flags in an otherwise sterling report. Employers added 353,000 jobs last month, almost double economists’ forecasts, and an additional 100,000 via revisions in previous months. Average hourly wages rose, too. For a start, wintry weather shrank the average workweek to 34.1 hours in January.

Persons: Biden, Bill Adams Organizations: Employers, Comerica Bank Locations: U.S

☆ Dual Mission for Macy’s New Chief: Revive Stores and Fend Off Takeover
▼ + stars: | 2024-02-02 | by ( Jordyn Holman | Lauren Hirsch | ) www.nytimes.com time to read: +1 min

As he prepares to take the reins as Macy’s chief executive on Sunday, Tony Spring has a tall order: He must contend with the existential crisis that mall-based department stores are facing to try to stay relevant in an increasingly e-commerce world. In December, an investor group submitted a bid that would take Macy’s private at a value of $5.8 billion. Mr. Spring, 58, has spent his career at Macy’s high-end store group, Bloomingdale’s. He started as an executive trainee in 1987 and rose through the ranks to become chief executive in 2014. He turned the chain into a “scrappy incubator” for ideas that were eventually brought over to Macy’s stores.

Persons: Tony Spring Organizations: Arkhouse Management, Brigade Capital Management

The big stakes of Musk’s outsize pay dealAn unusual pay package that Tesla devised in 2018 helped make Elon Musk the world’s wealthiest individual. The backstory: In 2018, Tesla set out 12 milestones tied to market capitalization, revenue and profit targets that Musk needed to reach to qualify for a stock package that is now worth over $50 billion. Experts thought it would be impossible to hit. Yet Musk — who told Andrew at the time that Tesla would hit a $1 trillion market cap within a decade — pulled it off. Shareholders sued, however, arguing that the plan was devised unfairly, with Musk essentially creating his own pay package with the help of allies on the Tesla board.

Persons: Tesla, Elon, —, Andrew Organizations: Shareholders Locations: Delaware

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