☕️Profoundly Misled

Good morning.

Explosive court documents reveal the reasons behind EVP’s decision to call police on its own portfolio company, StrongRoom AI in March. Capital Brief reports that the Sydney VC firm said it was “profoundly misled” and that there appears to have been “deliberate fraud” involved in procuring EVP’s investment.

EVP says StrongRoom AI represented itself as generating $8 million in ARR with "200% year-on-year growth" during investment negotiations, but that internal documents paint an entirely different picture.

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Market movers

Trump’s tariff blitz smashes Australian shares, with ASX heavyweights spiralling on fears of cost spikes, sales slumps and a global trade brawl. Ansell led the ASX 200 losses, diving 14.3% on warnings of a major profit hit from new US tariffs.

The quick sync

• Trump’s new tariffs risk tipping the US into recession and reigniting pandemic-level inflation, say top Wall Street economists. (Bloomberg)

• Trump says market reaction to tariffs is ‘going very well’ despite Wall Street’s sharp selloff (Bloomberg)

• As David Olsson writes, Australia must move fast to redefine its China strategy or risk being left behind in the world's most dynamic economic region. (Capital Brief)

• Leonardo.Ai’s founder isn’t fazed by OpenAI’s viral image update, hinting Canva has its own Ghibli-style tricks on the way. (Capital Brief)

Trading floor

M&A

• GIC to buy 10% of Transgrid for $1b, as owners seek exits due to clean energy costs. (The Australian)

• Vinci bids $3b for Cairns and Mackay airports, competing with Sojitz and Japan Airlines. (AFR)

• Fonterra’s $2b Mainland Group is attracting bids from Lactalis, Bega, and others. (The Australian)

• Jewelers Mutual Group acquires Sydney's Jewellers Loop, expanding into Australia. (BNA)

• The Levis family sells Cue Clothing and its Veronika Maine brand to British asset manager Hilco Capital, with key executives departing the business. (AFR)

• Australia's Galan Lithium rejected a $150m buyout bid from Zhejiang Huayou Cobalt and Renault Group for its Argentine assets. (Reuters)

• British firm Hilco Capital has acquired Australia’s Cue Clothing and Veronika Maine, as the Levis family exits the business after six decades amid ongoing plans to sell Dion Lee’s remaining assets. (AFR)

Capital Markets

• Intel shares rebound from Trump tariff hit after report of joint venture with TSMC to overhaul chipmaking and revive US production. (Capital Brief)(The Information)

• Australian law firms with global nuclear expertise are seeing a spike in client interest as Coalition energy plans stir quiet momentum ahead of the federal election. (Capital Brief)

• Trump imposes 10% tariffs on Australian imports, warns of beef ban. (Capital Brief)

• Peter Dutton suggests a deal with Trump could remove Australia’s tariffs, leveraging defense and critical minerals. (Capital Brief)

• US stock futures fall on Trump’s tariff announcement, sparking trade war fears. (Capital Brief)

• Australian businesses warn that US tariffs will raise costs and disrupt industries, urging restraint. (Capital Brief)

• Prime Minister Albanese confirms there is no US ban on Australian beef exports but criticizes Trump’s tariffs as unfriendly. (Capital Brief)

• Global markets plunge after Trump’s severe tariff announcement, with fears of a full trade war, while countries like Australia and the UK seek negotiations. (Capital Brief)

• France pushes for the EU to target US tech firms in retaliation to Trump’s tariffs, with negotiations ongoing to avoid countermeasures. (Capital Brief)

• US stocks lose $2t amid fears that Trump’s tariffs will lead to a recession, with global markets reacting to the tariff impacts. (Capital Brief)

• APRA raises ANZ’s capital add-on by $250m over risk concerns, accepts undertaking. (Capital Brief)

• ANZ review blames middle managers for failing to address inappropriate behavior in markets division. (AFR)

• The Australian dollar drops in volatile trading after Trump’s global tariffs announcement, with traders shifting to a risk-off stance. (Capital Brief)

• Light & Wonder vows to fight Aristocrat’s new legal claims over Dragon Train pokies, which allege trade secret misappropriation. (Capital Brief)

• Three senior bankers from Judo Bank are launching a national debt advisory and brokerage business in Melbourne. (AFR)

• Region Group plans a $100m share buyback to optimize its portfolio and support growth. (Capital Brief)

• Australian law firms are quietly monitoring US legal challenges to DEI programs, as Trump's administration pressures firms to abandon them. (Capital Brief)

• PointsBet disputes BlueBet’s funding claims amid competing takeover bid. (AFR)

• OPEC+ to boost oil output in May, pressuring quota violators like Kazakhstan. (Capital Brief)

• Scyne Advisory plans to cut 10% of its staff and shift focus to technology projects amid declining demand in the professional services sector. (Capital Brief)(AFR)(The Australian)

• Gold prices hit record highs amid tariff uncertainty, raising concerns about affordability and demand. (The Australian)

• Australian law firms see growing interest in nuclear energy amid political shifts. (Capital Brief)

• Leonardo.Ai founder downplays ChatGPT’s new image tools, promises similar features soon. (Capital Brief)

• TikTok faces a €500m fine for illegally transferring EU user data to China, violating GDPR rules. (Bloomberg)

• InfraBuild dodges default with $240m debt deal as pressure mounts over delayed accounts and falling earnings. (AFR)(The Australian)

VC

• None

People moves

• RBC hires Alex Sutton from Morgan Stanley to boost hedge fund sales. (AFR)

• JPMorgan hires Matt Chalmers to strengthen natural resources team. (AFR)

• Di Williams steps down as Fernwood Fitness CEO after 36 years, becoming chair of the board. (BNA)

The watercooler