Record levels of M&A; huge IPO week; Didi's post-IPO troubles; Robinhood finally flips, and much more
Happy Friday!?
?In the first half of this year, global M&A activity broke records for a second consecutive quarter as companies continued to borrow cheaply and spend their cash reserves on transformative deals to reposition themselves for the post-COVID world.
Deals worth $1.5 trillion were announced in the three months to June 30, more than any second quarter on record and up 13% from the record first quarter of the year despite activity among blank-check firms slowed down, Refinitiv data shows.
Second quarter volumes rose 440% in the United States with $699 billion worth of M&A deals compared to the same quarter last year when the world's biggest economy came to a halt because of the pandemic.
But for all its frenzy the second quarter saw a steep decline in SPAC listings as investors grew wary of the asset class and regulators tightened up scrutiny on blank-check companies.
Elsewhere, another absolutely insane week for IPOs in the United States, the biggest week for listings so far this year – leading the way was China’s ride-hailing giant Didi Chuxing, which raised over $4 billion in an upsized offering.
Didi shares ended their first day of U.S. trading slightly over their IPO price, valuing the SoftBank-backed company at over $68 billion in the biggest U.S. listing by a Chinese company since 2014.
Didi, however, has run afoul of Chinese authorities days after its blockbuster IPO – earlier on Friday, China's cyberspace agency said it had launched an investigation into the ride-hailing giant to protect national security and the public interest.
The Cyberspace Administration of China (CAC) said on its website that Didi was not allowed to register new users during its investigation, which was announced just two days after Didi began trading on the New York Stock Exchange. (Full Story)
Beijing-based Didi said in a statement to Reuters that it planned to conduct a comprehensive examination of cybersecurity risks and would cooperate fully with the relevant government authority.
Chinese internet regulators have tightened rules for the country's tech giants in recent years, asking companies to collect, store and handle key data properly.
After several weeks of speculation on when they would flip, Robinhood finally did – and what an explosive filing it was! Did not disappoint one bit. Totally worth the wait.
In its S-1, Robinhood flagged a swathe of investigations by prosecutors and regulators, including a startling revelation on how a probe by the U.S. attorney's office in California even resulted in a search warrant for Robinhood co-founder and CEO Vlad Tenev's cell phone (!!!).
The company, under scrutiny after this year's trading frenzy for so-called meme stocks such as GameStop, is aiming for an IPO valuation of over $40 billion, Reuters has previously reported.
Robinhood's IPO filing detailed for the first time how the trading mania, which has swept amateur investors, fuelled a four-fold jump in its revenue over January to March, and also how its quick expansion came at a cost.
It reported a net loss of $1.4 billion for the period after borrowing $3.5 billion via convertible bonds to backstop the wave of trading orders amid the rally in a few stocks, which had been shorted by hedge funds and championed by individual investors in online chatrooms including Reddit's WallStreetBets.
My brilliant colleagues scooped that ChemChina is aiming to raise around $10 billion from a Shanghai IPO for Swiss agrichemical giant Syngenta Group, in what is set to be the world's largest flotation this year.
ChemChina, which became part of Sinochem Holdings Corp last month, is also considering a secondary listing for Syngenta that could take place less than a year after its debut, with exchanges in Zurich, London and New York among the options being examined. Hong Kong is also being considered but is not a frontrunner. Syngenta later confirmed the Reuters scoop.
And finally, my colleagues in Europe were first to report that Credit Suisse is considering centralising the management of its bankers to the world's wealthy, replacing a regional structure, as part of efforts to fast-track an overhaul after a series of scandals.
The Swiss bank and its board are looking to decide on a fresh strategy as soon as October after meeting in the mountain town of Bad Ragaz.
Re-imagining the most prized part of Credit Suisse illustrates how deep this overhaul is likely to be, with executives discussing folding the private banking business and other services managing money for the world's rich into one global division.
With that, here are the other main highlights of our deals coverage this week:
Galaxy Interactive, the venture capital division of billionaire crypto investor Mike Novogratz's Galaxy Digital, has taken a lead investor role in virtual real estate developer Republic Realm, its managing director said.
Goldman Sachs Group's investment arm and Swedish private equity firm EQT AB said they will buy clinical research company Parexel International Corp from Pamplona Capital Management for $8.5 billion.
Semiconductor equipment maker MKS Instruments said it will buy specialty chemicals group Atotech for about $5.1 billion to expand its chip manufacturing capabilities.
Gympass, which makes gym memberships more accessible for corporate employees, has raised $220 million in a funding round led by existing investor SoftBank Group, more than doubling the startup's valuation to $2.2 billion.
SoftBank Group is slashing jobs at its global robotics business and has stopped producing its Pepper robot, according to sources and documents reviewed by Reuters, as the conglomerate downgrades its industry ambitions.
BT's new billionaire investor is backing the British telecoms group to go it alone, seeing no need to sell a stake in network arm Openreach or perhaps even to find a partner for its fibre roll-out.
Shares of security software provider SentinelOne jumped 21.4% in their U.S. stock market debut, giving the company a market capitalization of nearly $11 billion.
Clarios International, a car battery maker backed by Canada's Brookfield Asset Management, made public its paperwork for an initial public offering in the United States.
Krispy Kreme shares fell 4% in a tepid Nasdaq debut, valuing the maker of the "Original Glazed" doughnut at $2.62 billion in its return to stock market five years after it was taken private.
Bowlero, owner and operator of bowling centers, said it had agreed to go public through a merger with blank-check firm Isos Acquisition Corp, valuing the combined company at around $2.6 billion.
Thank you for reading this week’s edition! Feedback is always welcome. Please do pass on the newsletter with anyone you think might be interested.
?And to all my U.S. readers, wish you a great 4th of July weekend!
Warm regards,
Anirban?
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Anirban Sen
?Editor in Charge, Finance
Thomson Reuters
Twitter: @asenjourno
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