☕️Grease the Wheels

Good morning.

When news first emerged in February that AI infrastructure company Firmus was re-opening its books for yet another pre-IPO equity raise, initial chatter suggested the round would be restricted to new strategic investors only. Instead it was two of the company’s existing backers that returned as the headline participants for the USD505 million ($730 million) raise; Coatue Management and Nvidia.

Nvidia returns to the table after facing scrutiny (in no small part from Michael Burry of US housing bubble and GFC fame) in the US over “circular” transactions it has engaged in with its customers, whereby the chipmaker agrees to invest in a customer, which then uses some of the capital it has raised to commit to buying Nvidia’s chips.

Shaun Weick, a portfolio manager at Firmus investor Wilson Asset Management, told Capital Brief he believes Nvidia’s involvement simply “greases the wheels” of the broader AI build out.

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Market movers

Shares in Qantas surged 9.4% on Wednesday as a US-Iran ceasefire sent oil prices to their biggest single-day fall in six years, easing the fuel cost pressures that had weighed on airline stocks throughout the six-week conflict and delivering the stock its best session since the pandemic.

The quick sync

• Canva acquires two Australian-founded AI companies in push to become the AI workspace. (Capital Brief)

• Trump's war threats tested Australian political loyalty and not everyone stayed quiet. (Capital Brief)

• DroneShield's new leadership faces a trust test after CEO and chair quit, wiping $500m off its value. (Capital Brief)

• Australian startup acquisitions are returning liquidity to VCs, but some wonder if the exits are coming too early. (Capital Brief)

Trading floor

M&A

• Pro Medicus secures a $23m imaging contract with UMMS. (Capital Brief)

• Lumonus teams up with NY cancer center to expand AI oncology platform. (AFR)

• Oxford Properties eyes $1.5b sale of Australian build-to-rent business Indi. (The Australian)

• ASIC probes sale of Interprac Financial tied to Shield and First Guardian schemes. (AFR)

• Chalmers clears CC Capital’s $3.3b Insignia takeover. (Capital Brief)

• Ex-Rio Tinto CEO Tom Albanese’s American Ocean Minerals to merge with Odyssey Marine Exploration in a $1.4b deal. (AFR)

• Morrison and Future Fund join the bidding for Ausgrid’s $3b Plus Es, Australia’s largest smart meters business. (AFR)

Capital Markets

• Coinbase gets ASIC licence to expand in Australia. (Capital Brief)

• Flight Centre shares jump after announcing the sale of its 47% Pedal Group stake. (Capital Brief)

• Beetaloo Energy raises $60m+ as gas production nears. (AFR)

• Perenti wins $180m contract extension with Regis Resources. (Capital Brief)

• Tamboran Resources raises $200m amid high oil prices. (The Australian)

• Magellan Financial Group reported a $2.4b drop in assets under management ahead of Barrenjoey merger vote. (Capital Brief)

• Samsung Group family member is selling USD2.1b in shares for inheritance taxes. (Bloomberg)

• Cheviot targets $150m first close for debut fund. (AFR)

• Consumer confidence ticks up but stays near record lows, risking spending slowdown. (Capital Brief)

• Dexus–Melbourne Airport court battle descends into chaos. (AFR)

• DroneShield CEO and chair exit shocks market, erasing $500m in value. (Capital Brief)

• Praetorian Aeronautics raises $30m+ at $100m+ valuation for AI drones. (AFR)

• EOS fined $4m for 2022 revenue disclosure breach. (Capital Brief)

• TPG skips Qscan, eyes higher-growth diagnostic imaging targets. (The Australian)

• Alibaba and China Telecom unveil 10,000-chip AI data center with domestic chips. (Capital Brief)

• Aitken Mount Capital Partners crosses $250m in TPG Telecom stock. (AFR)

• Delta warns of pricier flights after $2b fuel cost hit. (Capital Brief)

• Meta debuts Muse Spark, first AI model from Zuckerberg’s Superintelligence Labs. (Capital Brief)

• Nvidia joins $730m funding round for AI firm Firmus amid criticism. (Capital Brief)

• How the math wors on a USD1.75 trillion SpaceX valuation. (Reuters)

• Insurers’ USD1 trillion buildup in private credit is leaving regulators in the dust. (WSJ)

VC 

• Kimia raises $7m seed funding for AI chemicals platform. (Capital Brief)

• Australian social media app Spoony shut down after rejecting AI tools. (Smart Company)

• Canva-led startup acquisitions return VC liquidity amid questions on lost potential. (Capital Brief)

People moves

• oOh!media names Philippa Kelly as new chair. (Capital Brief)

• DroneShield CEO Oleg Vornik steps down, Angus Bean takes over. (Capital Brief)

• Jeff Shell steps down as Paramount president after allegations of SEC violations. (Reuters)(CNBC)

The watercooler