January 09, 2025 | Read Online

What You Need to Know for January 9th

A Mad Dash of M&A to Start the Year. Plus, the Quantum Computing bubble gets popped.

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Welcome back!

A lot has happened since we last spoke, with Jensen Huang popping the quantum computing bubble, a massive rush in M&A and credit markets activity, rates continuing to push higher, and a devastating wildfire in Los Angeles.

We're skipping the earnings corner this edition, but we have UnitedHealth Group, Bank of America, Wells Fargo, BlackRock, and Delta Airlines among the names reporting Friday.

As a reminder, the US market is closed today in remembrance of President Jimmy Carter.

Let's get into it.

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Today's Headlines 🍿

Jensen Huang pops the Quantum computing bubble: Quantum computing stocks tanked on Wednesday after the Nvidia CEO said that quantum computing will likely take 15-30 years to have practical use. Stocks that tanked more than -35% on Wednesday included Rigetti Computing, Quantum Computing, IonQ, and D-Wave Systems, which were among the companies mentioned by Martin Shkreli in a Short Report he posted on X
President Trump has his eye on Greenland, threatening Denmark with tariffs and not ruling out military presence in Greenland or the Panama Canal. Donald Trump Jr. visited Greenland earlier this week
The latest on the LA fires: Wildfires have devastated Los Angeles, including the Pacific Palisades, decimating complexes and displacing thousands of residents. CBS News has the latest here
Apollo's Chief Economist Torsten Slok compared rising U.S. Treasury Yields to the crisis former UK Prime Minister Liz Truss faced. In 2022, the British bond market spreads widened after Truss announced tax cuts that would've been difficult to finance, driving her eventual resignation
The U.S. added 122k jobs in December, less than the 140k expected. With the lowest growth since August, private sector labor demand is falling. Meanwhile, wage growth stalled to 4.6%, the lowest since 2021
Alacrity Solutions has been taken over by private credit lenders: Antares, Blue Owl, and KKR are among the companies taking the keys from BlackRock, the Sponsor. This has been reported by Bloomberg Law. Alacrity is an insurance claims manager that has struggled amid fewer weather-related claims. The prior structure included $1B in Unitranche financing and $500mm in junior capital from GSAM. First-lien lenders will now own 90% of the company, with lenders converting half of their loan into equity and providing some new debt financing. GSAM's $500mm junior capital piece, will turn into 10% equity. The new capital structure will include a $450mm TL and $250mm in preferred equity
Northwestern Mutual has taken a stake in credit firm Sixth Street, and given the alternative credit manager $13B of asset-backed credit to manage
Point72 is building out a private credit practice, hiring an ex-Blackstone veteran to take charge
Bridgewater and BlackRock start 2025 with layoffs: Bridgewater, the world's biggest HF, cut 7% of its staff (90 employees) in an effort to remain lean and prepare to hire new talent. Additionally, BlackRock cut 1% of its workforce, roughly 200 people
Disney is combining its Hulu+ Live TV offering with Fubo. The move combines two internet TV bundles structured like traditional cable subscriptions and does not include original Hulu content (like "The Handmaid's Tale" or "Shogun"). The new company will operate under the Fubo brand, and work to compete against the dominant YouTube TV
Getty and Shutterstock are officially merging at a $3.7B valuation. The deal links the two largest licensed visual content providers in the US, both struggling to navigate AI's impact on the content creation market
Constellation Energy is nearing a $30B deal to acquire Calpine. Calpine runs 80 U.S. power facilities and is owned by Energy Capital, CPP, and Access Industries
Apollo and BC partners are closing in on a $5.6B deal for GFL's environmental services unit. Historically growing through an aggressive (and debt heavy M&A strategy, GFL is one of North America's largest waste management providers
JP Morgan is calling for 5 days back in the office: J.P. Morgan is eliminating hybrid work options for its 300,000 employees and preparing to require a 5 day in-office work week
The Park City Ski Patrol and management have tentatively reached a new labor agreement. This comes after terrible press from long lines over the holiday weekend
Nvidia unveiled new chips designed for desktop and laptop PCs that use AI to support video gaming. The move reflects the company's commitment to serving consumers in addition to its core enterprise offerings
Anthropic is in talks to to raise $2B in funding at a $60B valuation. If the raise is successful, the AI hyperscaler would become the world's 7th most valuable startup
Altman's Allegations: OpenAI CEO Sam Altman's sister accused him of sexual abuse when they were children. Sam Altman and his family have denied these claims, citing his sister is demanding more money from them and is dealing with mental health challenges
Meta Updates its factchecking policies: Meta announced that, in a similar fashion to X, its platform will eliminate third-party factchecking in favor of user-generated "community notes."
UFC CEO Dana White is joining Meta's board. White is a close Trump ally and friend of Zuckerberg, himself a well-known MMA fan
Like watching paint dry? Once exceedingly fragmented, the paint coating industry has seen a surprising amount of consolidation with PE firms aggressively pursuing rollups
Tencent was added to the U.S. list of "Chinese military companies." Though the inclusion on the list does not mean that the social media giant will be banned, the news adds pressure on the Treasury to sanction the company
Justin Trudeau has resigned as Prime Minister of Canada on Monday. His 9 years in charge came to end after being forced out by the Liberal party. Once widely heralded for bringing back liberalism to Canada, Trudeau saw voters turn on him amidst soaring immigration and food & housing costs
TD Bank might sell their 10.1% stake in Charles Schwab, dependent on a strategic review
Ligado Networks, a satellite communications company, filed for bankruptcy on Monday. The company is seeking to reduce their $7.8B debt load into $1.2B

M&A Transactions💭

Paycor (NAS: PYCR), provider of payroll and hum capital management solutions, has reached a definitive agreement to be acquired for $4.1B by Paychex (NAS: PAYX). EV/EBITDA was 42.69x and EV/Revenue was 6.04x. Goldman Sachs advised on the sale.

IPI Partners, an investment platform, was acquired for $1.0B by Blue Owl Capital (NYS: OWL). Berkshire Global Advisors advised on the sale.

Inari Medical (NAS: NARI), a medical device company, has reached a definitive agreement to be acquired for $4.9B by Stryker (NYS: SYK). EV/Revenue was 8.53x. Morgan Stanley advised on the sale.

EvolutionIQ, developer of a claim guidance platform, was acquired for $730.0M by CCC Intelligent Solutions (NAS: CCCS).

EPIC Y-Grade Pipeline, operator of an oil and gas pipeline company, has reached a definitive agreement to be acquired for $2.2B by Phillips 66 (NYS: PSX). Jefferies advised on the sale.

The Food Testing Business of Bureau Veritas was acquired for $375.77M by Meriex Nutrisciences.

The Fiber Business Unit of TDF Group was acquired for $1.04B by CVC DIF. DC Advisory and BNP Paribas advised on the sale.

Stellar Blu Solutions, developer of software for connectivity, was acquired for $345.0M by Gilat Satellite Networks (NAS: GLT). Houlihan Lokey advised on the sale.

Kinectrics, provider of life cycle management services, has reached a definitive agreement to be acquired for $525.0M by BWX Technologies (NYS: BWXT). EV/Revenue was 1.75x.

Ironwood Midstream Energy Partners, operator of crude oil gathering pipeline system, has reached a definitive agreement to be acquired by Plains All American Pipeline (NAS: PAA) for $475.0M. RBC Capital Markets advised on the sale.

Humi, developer of cloud-based software, was acquired for $112.0M by Employment Hero.

Private Placement Transactions💭

InSilico Medicine, researcher and developer of an AI platform, raised $100.0M of Series E venture funding led by PDVC and Value Partners Group.

Halcyon, operator of a cybersecurity platform, raised $240.28M of Series C venture funding led by Evolution Equity Partners.

Verkada, operator of a cloud based physical security platform, raised $150.0M of venture funding led by General Catalyst at a pre-money valuation of $4.3B.

Stacked Farm, developer of end-to-end automated indoor vertical farms, raised $150.0M of venture funding led by Magnetar Capital.

Inari, operator of a plant breeding platform, raised $1440.0M of venture funding led by Flagship Pioneering, Non-Government Schools Superannuation Fund and Hanwha Impact.

Fourier Intelligence, developer and operator of a technology platform, raised $109.74M of Series E venture funding led by Shanghai Zhangjiang Science & Technology Venture Capital, Prosperity7 Ventures, and Shanghai Guoxin Investment.

Fire1, developer of a remote monitoring device, raised $120.0M of venture funding led by Elevage Medical Technologies and Polaris Partners.

Evergreen Nephrology, provider of kidney transplant and care hospital, raised $130.0M of venture funding led by Rubicon Founders and Oak HC/FT.

CeQur Simplicity, developer of drug delivery devices, raised $120.0M venture funding from undisclosed investors.

Aviceda Therapeutics, operator of a biotechnology company, raised $207.5M of Series C venture funding led by Omega Funds and TCG Crossover Management.