Musk Nukes Neoclouds

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Global equity hedge funds suffered their worst day since Covid, OpenAI resumed frontier AI model training, the Black Sea shipping route is now more deadlier than Hormuz, one-third of America's earnings boom is coming from just two chipmakers, and Musk gave a dire prediction for neoclouds.

ICYMI: We're hosting an elevated happy hour with our friends at DiligenceSquared on Tuesday, November 17 for NYC's senior private equity community. It's a great excuse to spend time among great company as the early sunsets and cold weather kicks in. RSVP here!

Alumni Ventures is offering investors a chance to join their syndicate to invest in leading startups like Groq, Replit, and others. You can learn more below.

Let's dive in.

Before The Bell

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Markets

• US stock indexes closed lower on Friday to end a rocky week as rising yields pressured the AI trade

• US high-yield risk premium climbed to a 17-month high

• Indonesia corporate risk premium jumped 28 bps to 67 bps to the widest since Covid on broad governance struggles

• Wheat slid for an eighth-week for its longest down streak since 1997 amid potential Ukraine-Russia peace talks

Earnings

• What we're watching this week:

  • Tuesday: UPS, Coca-Cola, Robinhood, Visa, PayPal

  • Wednesday: Alphabet, Microsoft, UBS, FedEx, Chipotle

  • Thursday: Amazon, Intel, Coinbase, Reddit, Starbucks, Eli Lilly

  • Friday: ExxonMobil, Chevron

• Full calendar here

Prediction Markets

• It's FOMC week. While rates are expected to stay steady, investors will be watching Kevin Warsh's communication very closely as the Fed navigates one of the most confusing economies in years

• Trade this market on the Polymarket US app. Get a $25 bonus with code LIT

Headline Roundup

• Trump weighs 'finishing if off' or deal on Iran as decision nears (BBG)

• US weekly jobless claims near 57-year lows (RT)

• Global equity hedge funds suffered their worst day since Covid (BBG)

• 0DTE option traders are betting against big S&P 500 swings (BBG)

• AI delivers 'zero financial payoff' to most companies (TC)

• Two AI chipmakers make up 34% of America's earnings boom (WSJ)

• AI spending fears threaten to swamp Big Tech's strong earnings (BBG)

• Musk gives dire prediction for neoclouds (RT)

• JPMorgan private bank is using AI to make advisors more efficient (BBG)

• Hong Kong could end trading lunch break in push to extend hours (FT)

• Anthropic's pitch to investors starts with taking their jobs (BBG)

• OpenAI resumed frontier AI training after security overhaul (RT)

• Amex will cut 5% of jobs (WSJ)

• Weil loses more top lawyers as merger talks collapse (WSJ)

• Black Sea shipping route is now more deadlier than Hormuz (FT)

• Ukraine disputes Musk's claim that it violated Starlink terms (CNBC)

A Message from Alumni Ventures

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Deal Flow

M&A / Strategic

• Medtech Smith & Nephew's talks to ‌merge with J&J's orthopaedics unit at a $22B valuation collapsed over disagreements on control

• $16B-listed Eurofins Scientific is weighing a sale of materials testing firm EAG Laboratories

• $13B-listed Instacart is exploring a sale to Uber or DoorDash

• German chemicals giant BASF boosted its cash takeover offer for peer Evonik Industries to $12.3B

• CVC and Belgian investment firm GBL secured a 74.3% stake in Italian pharma group Recordati after raising their bid to a $12.3B valuation, above the minimum threshold but short ​of the 90% level required to delist the firm

• Veritas Capital is exploring a $10B sale of aerospace aftermarket company Chromalloy

• Non-profit health system Bon Secours Mercy Health is nearing a takeover of Bain Capital-backed surgical care provider Surgery Partners at a $6B valuation, including debt

• UK retailer Frasers Group took control of $3B-listed Hugo Boss after pushing its stake above 50%

• Tesla and Nvidia will invest $2.8B in Samsung Electro-Mechanics to fund facilities making ⁠advanced chip substrates

• AVID Property Group joined the bidding war for Australian developer Ingenia Communities with a $1.6B bid

• Pitchwise Holdings, a consortium backed by KKR co-founders Henry Kravis and George Roberts and led by sports execs Ann Rodriguez and Corey Woolfolk, will acquire a 42% stake in Spanish soccer club Valencia from majority owner Meriton Holdings at a $1.4B valuation

• Dalmore Capital, Apax Partners, and Nordic Capital are interested in acquiring UK commercial equipment supplier JLA Group from PE firm Cinven for potentially over $1.3B

• Gilead Sciences ​will acquire PepStar Therapeutics' oral inflammation drug ‌program for $1.275B cash

• Goldman Sachs Alternatives will acquire a majority stake in UK testing and ‌safety compliance company Celnor Group from PE firm Inflexion for $1.12B

• Swiss pharma giant Roche acquired rights to develop and ​commercialize an experimental lung cancer drug from Zymeworks in an $813M deal

• Italian pasta maker Barilla acquired healthy mac and cheese company Goodles for $750M cash

• Mark Walter, the CEO of Guggenheim Partners, is looking to sell WNBA team Los Angeles Sparks for a record $700M

• Spanish renewables Forestalia Renovables is considering a sale of its power assets to raise up to $337M to develop power plants for data centers

• European digital wealth manager Moneyfarm rejected a ~$300M takeover approach from trading platform eToro

• UK and Canada scrapped talks to merge their defense financing banks

VC

• Pearl, an Israeli crypto research lab/startup, raised $130M across a $55M round backed by Lightspeed, Ribbit Capital, and Square Peg and a $75M specialized fund for GPU purchases

• Newpress, an independent creator-led media company, raised a $12M round led by Emerson Collective and Glick Family Investments

• Formic, a commercialization platform for physical AI, raised a $50M Series B led by Mercato Partners

• Cognitive Credit, a UK provider of corporate credit data, analytics and AI technology, raised a $40M strategic growth investment led by Summit Partners

• BOB, an AI finance employee and banking platform for SMBs, raised a $5.5M seed round led by Mischief

Access the complete VC deal flow and data on Fundable

IPOs / Listings / Issuances / Block Trades

• Jio Platforms, the telecoms unit of Indian conglomerate Reliance Industries, raised $3.1B at a $107B valuation in a record India IPO that was 22x oversubscribed

• Chinese printed circuit board maker Dongshan Precision Manufacturing raised $1.3B in Hong Kong's biggest listing in two months

• SoftBank-backed Indian travel platform OYO may IPO in India at a lower $2.6B pre-money valuation after investor pushback

• Allergies-focused biotech Lycia Therapeutics soared 67% in its trading debut after raising $317.5M for a $1.65B market cap in an upsized IPO

• Indian manufacturing platform Zetwerk fell 16% in its trading debut after raising $530M for a $2.4B market cap in an India IPO

• Novo-backed respiratory disease-focused Swiss biotech Windward Bio filed for a US IPO

• Armenia's largest lender Ardshinbank is weighing a London IPO

Debt

• Shareholders and creditors of Brazilian petrochemicals firm Braskem are moving closer to a deal to rework $11B of debt

• Indonesia is seeking to raise $1.5B in a panda bond sale

Bankruptcy / Restructuring / Distressed

• Barclays, Abu Dhabi Commercial Bank, Bank of Baroda, hedge fund Fidera, and 32 other creditors are seeking to recover money owed by UAE Exchange Center, a collapsed remittance provider with a $1B hole in its balance sheet

• A group of senior creditors to JetBlue Airways hired PJT Partners as bankruptcy risks grow

• 15 golfers tentatively committed to the BC Partners-backed successor to LIV Golf

Funds / Secondaries

• Canada will invest $1.75B in startups to keep them in the country

• Aussie VC Blackbird raised $750M for its sixth fund, the largest-ever VC fund in Australia

• Anthropic will launch a new European AI consultancy backed by PE firm Hg

Crypto Sum Snapshot

• Corporate America is balking at 'tokenized' stocks

• Netanyahu suggests using crypto to bypass economic sanctions

Crypto Sum compiles the most important stories on everything crypto. Read it here.

Lit's Picks

• @dummerspast39 resurfaced a rare clip of Anthropic founder Dario Amodei speaking against the Iraq War, back in 2003 when he was a sophomore at Caltech. Seems like he's been "concerned" about everything since birth.

• While "The Social Reckoning" and "Musk" massively flopped, Nathan Fielder's "You Can See Everything" documentary on Elizabeth Holmes is absolutely crushing it. Check out what WSJ has to say about the secret behind its success.

Upcoming Events

Litquidity Happy Hour - Presented by DiligenceSquared

​Litquidity is teaming up with Cucina Alba to bring together NYC's senior private equity community for an evening of drinks, great company, and even better pizza.

​Join us on Tuesday, November 17 in Chelsea for some relaxing vibes after work and enjoy the company of fellow industry professionals and our friends at DiligenceSquared.

RSVP here

Financial Services Recruiting

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We aim to place strong candidates across private equity, hedge funds, venture capital, growth equity, credit, and investment banking.

We're currently seeking talent for some incredible roles. Head over to Litney Partners to drop your resume / create your profile and we'd love to get in touch!

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