What You Need To Know for March 20th

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Welcome back!

Stocks had a solid rally following the Fed holding rates and Jay Powell putting out a rate cut path that’s conducive to stocks. Futures are pointing towards a solid Thursday, so let’s hope we can have a nice rally before the tariff uncertainty takes center stage again.

However, yesterday evening, Trump pushed for more rate cuts as we approach April 2nd, the day most of the tariffs will go into effect.

Today’s Newsletter is sponsored by Hebbia, your new AI Analyst.

Let’s get into it.

Earnings Corner 📜 

With earnings season cooling down, we have one name to highlight for this edition.

Trending Down 📉 

General Mills (GIS): General Mills beat on earnings, but reported revenue below estimates, along with a weak 2025 outlook. Mgmt. said they entered the year expecting the environment to improve, but the turnaround has not materialized. Organic net sales are expected to fall 1.5%-2% (vs. flat to 1% growth previously). The stock was down 2.1%

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Today’s Headlines 🍿 

• The Fed holds rates at 4.25%-4.5%, in line with expectations. The Fed maintained their forecast of 1-2 rate cuts in 2025, despite an outlook that calls for lower economic growth and higher inflation. Fed Chair Jay Powell called the potential impact of tariffs “transitory”, believing these wouldn’t be lasting inflationary pressures and that the Fed could stay in control.

• Takeaways from "AI Woodstock”: During Nvidia’s annual GTC Conference, Jensen Huang showcased an upgraded version of the much heralded Blackwell AI chips. Huang also announced Rubin, chips with 3.3x the compute of the Blackwell Ultra

• Ted Pick brings down the axe. Morgan Stanley is announcing layoffs of ~2,000 workers as part of the first major workforce reduction launched by its new CEO. Executives are grappling with unexpectedly low attrition from their ranks across the street — Goldman recently announced a plan to cut up to 5% of its workforce

• Private markets are the future. MS Wealth Management Chief announced that companies staying private longer is a “permanent change.” Right now, there are 1,500+ unicorns worth collectively more than $5T in private markets

• Hamilton Lane announced the launch of a retail private infrastructure fund. Speaking of Private Markets, Hamilton Lane launched Hamilton Lane Private Infrastructure Fund on Republic, a retail-focused investment platform. This marks a pivotal moment for retail investors, who can now gain access to infrastructure investments such as hyperscale data centers, international airports, and natural gas airports

• Alphabet’s biggest acquisition yet: Google is buying Wiz for $32B. The Israeli-based cybersecurity startup had $350mm in ARR in ‘24 and is guiding for $1B in ARR in ‘25. The impressive multiple derives in part from optimistic growth expectations and the platform’s ability to run across cloud service providers

  • This was a home run for some VCs, with seed investors such as Sequoia, Cyberstarts, and Index Ventures expected to net a 200x return

• CoreWeave is looking to raise $2.7B in an IPO: The Nvidia-backed AI startup that provides data center access and chips capable of handling AI workloads, is asking for $47-$55 share - at the high end of talks. MS, JPM, and GS are the lead underwriters and are kicking off its initial roadshow this week

• Sponsors are looking to creditors. PE firms are struggling to exit in a dry M&A environment. As a result, they’re turning to credit investors for dividend recaps so they can pull equity out of their portcos. Since January, 20+ businesses have borrowed debt to pay their owners

• X is so back. After rumors of equity marks of less than $10B in September, the social media site earned a $44B valuation in a secondary deal at the beginning of March

• Softbank has agreed to acquire Ampere Computing, a chip design startup, for $6.5B. The transaction is expected to close in 2H25. Carlyle and Oracle are the exiting Sponsors.

• CVC is in talks to acquire Fortress, the alternative credit asset manager that’s backed by Mubadala, the Abu Dhabi sovereign wealth fund. Mubadala is the majority owner of the $49B firm, with CVC reportedly having interest in expanding its Private Credit offering

• American, British, and Turkish defense manufacturers are left out in the cold. A new €150bn French-led defense funding program will only include EU defense firms and those with defense agreements with the bloc

• Erdogan’s rival detained. Turkish authorities arrested the country’s most popular politician and mayor of Istanbul on corruption charges. Triggering a selloff in the country’s stock and currency, the detention is part of an increasingly aggressive campaign by President Erdogan to silence dissent

• Rippling sues Deel. The HR software firm alleged its rival engaged in corporate espionage. Parker Conrad listed out a complaint that showed that Deel allegedly had a spy working at Rippling. Rippling was able to “honeypot” the spy, who locked himself in a bathroom rather than turn his phone over

• Amazon is cutting middle managers. CEO Andy Jassy said that he’s looking to empower individual employees over managers who want to “put their fingerprint on everything.” Amazon is a leader in a new era of flattening organizational structures

• Sixth Street is acquiring a 10% stake in the San Francisco Giants. Approved this week by the MLB, the private equity firm’s purchase grants a $4.2B valuation on the franchise. Funds will primarily go toward upgrading Oracle Park and the team’s practice facilities in Arizona

• Starboard preps for a proxy fight at Autodesk. The activist investor has a $500mm stake in the software-design firm. Led by Jeff Smith, Starboard is looking to nominate a minority slate of directors before the tech firm’s annual meeting

• Forever21 files for bankruptcy (again). Citing competition from overseas fast fashion, the retailer failed for the second time in six years. The company is shuttering its US business and looking for a buyer for any remaining assets

• Astronauts return to Earth. After being stranded in orbit for nine months, two NASA astronauts touched down off the coast of Florida. The pair had planned to spend just 8 days in space, but their Boeing spacecraft designed to take them home failed in June

M&A Transactions💭 

Softchoice (TSE: SFTC), a technology service and solutions provider, was acquired for $1.14B by World Wide Technology. The transaction values the company at $2.22B. EV/EBITDA was 26.3x and EV/Revenue was 2.88x. Origin Merchant Partners, RBC Capital, and TD Securities advised on the sale.

Maverick Natural Resources, operator of oil and gas assets, was acquired for $1.3B by Diversified Energy Company (LON: DEC). EV/EBITDA was 3.42x and EV/Revenue was 1.44x. Citigroup, KeyBanc Capital Markets, Stifel Financial, and Truist advised on the sale.

Jaccs (TKS: 8584), a consumer finance company, was acquired for $260.72M Mitsubishi UFJ Asset Management. EV/EBIT was 3.43x and EV/Revenue was 0.55x.

System High, provider of advanced protection and secrecy, was acquired for $114.6M by Enlightenment Capital. KippsDeSanto & Company advised on the sale.

Poppi, producer of prebiotic soda beverages, has reached a definitive agreement to be acquired for $1.65B by Pepsico (NAS: PEP). EV/Revenue was 3.3x. Goldman Sachs advised on the sale.

Notified, developer of cloud media monitoring, has entered into a definitive agreement to be acquired for $534.5M by Equiniti Group. RBC Capital Markets advised on the sale.

Harmony Energy Income Trust (LON: HEIT), an investment company, has reached a definitive agreement to be acquired for $243.21M by Foresight Group.

Greenlink Interconnector, operator of an electrical interconnector cable project, was acquired for $1.0B by Baltic Cable and Equitix.

First IC Corp (PINX: FIEB), a bank holding company, has reached a definitive agreement to be acquired for $206.0M by MetroCity Bankshares (NAS: MCBS). Stephens advised on the sale.

EsoBiotec, developer of immunotherapies, has reached a definitive agreement to be acquired for $1.0B by AstraZeneca (LON: AZN) for $1.0B. Centerview Partners advised on the sale.

Engineered Transportation International, manufacturer of energy and transportation equipment, was acquired for $592.0M by TerraVest Industries (TSE: TVK). The transaction includes a $46.0M contingent payout based on future financial performance. EV/Revenue 0.99x.

Bajaj Allianz Life Insurance, provider of life insurance products, reached a definitive agreement to be acquired by Bajaj Finserv (BOM: 532978) for $1.2B.

Araris, developer of an antibody-drug, reached a definitive agreement to be acquired for $400.0M by Taiho Pharmaceutical Company.

Sembcorp Environment, provider of medical and bio-hazardous waste management, was acquired for $306.6M by TBS Energi Utama.

Dellner Couplers, manufacturer and supplier of train connection systems, has reached a definitive agreement to be acquired for $945.05M by Westinghouse Air Brake Technologies (NYS: WAB). J.P. Morgan advised on the sale.

Austindo Nusantara Jaya (IDX: ANJT), a holding company engaged in trading, services, and operations related to palm oil plantation and processing, reached a definitive agreement to be acquired for $329.73M by Ciliandra Perkasa. EV/EBITDA was 6.21x and EV/Revenue was 1.53x.

Aspen Manufacturing, manufacturer of independent evaporator coil and air handlers, reached a definitive agreement to be acquired for $313.5M by CSW Industrials (NAS: CSWI). EV/EBITDA 11.0x and EV/Revenue was 2.56x.

Wiz, developer of a cloud security platform, reached a definitive agreement to be acquired for $32.0B by Alphabet (NAS: GOOGL). EV/Revenue was 37.34x.

Private Placement Transactions💭 

Pioneer Aluminium Industries, operator of an aluminum mining company, has reached a definitive agreement to received $243.75M of financing from United Company Rusal (MISX: RUAL).

Philomaxcap, engages in the production, advise, purchase, sale, and distribution of media, received $102.88M of financing from undisclosed investors.

Erisha E Mobility, manufacturing of electronic vehicles and charging stations, received $1.0B of financing from undisclosed investors.

SINI, operator of a network technology company, raised $120.0M of venture funding from undisclosed investors.

Latigo Bio, operator of a biotechnology company, raised $150.0M of Series B venture funding led by Blue Owl Capital at a pre-money valuation of $380.0M.

Curevo Vaccine, developer of clinical-stage adjuvanted subunit vaccine, raised $110.0M of Series B venture funding led by Medicxi.

Different Technologies, provider of digital financial services, raised $134.0M of venture funding from undisclosed investors.

Apptronik, operator of a robotics company, raised $403.04M of Series A venture funding led by B Capital Group and Capital Factory.

Factorial, developer of a human resources management platform, raised $120.0M of venture funding led by General Catalyst.

Odds of the Day 🍒 

Kalshi traders are pricing in a 24% chance of Duke winning March Madness

*New Traders on Kalshi receive a $20 bonus of trading credit when depositing $100+ with the code “HYH”.

Noteworthy Chart 🧭

This was an interesting chart from Carbon Finance on “Shareholder Yield” - aka the amount of cash returned to investors from buybacks, dividends, and reducing debt.

Meme Cleanser 😆 

Finance Merch Referrals ☕️ 

Until next time!

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