☕️ Tightrope terror

Rate hikes are causing real pain.

September 07, 2023

Good morning.

“A man’s home is his castle,” Daryl Kerrigan was fond of saying. The upkeep is certainly becoming comparable.

The latest GDP figures have dropped and beyond indicating a(nother) per-capita recession, they show Australians are spending $83 billion a month just to keep up with their interest repayments. Forget the principal.

That’s twice what we were paying 12 months ago and more for the RBA to chew on at its next meeting. Yet as Australia walks an economic tightrope, is it time we started getting more regular economic readings?

Another thing: the LOI Footy Tipping Comp is still raging and as we head into finals, it’s tight at the top. Just one point separates each of the top three contenders. Big shout out to EdamameandChill, Tim Cudlipp, and johnfjohnf. Everyone else, take notes.

LOI Subscriber #TBD

MARKET MOVERS

*Stock data as of the market close. Commodities and crypto data in USD.

Market News: The hype around drugs weight-loss drugs like Ozempic is beginning to show up on the market in surprising ways.

Shares in ResMed dragged on Wednesday after UBS analysts slashed their price target on the dual-listed medical equipment maker. They expect these drugs will cut demand for sleep apnea treatments.

It’s a roundabout impact for a group of drugs originally intended to tackle diabetes. At any rate, they’re picking up regulatory steam.

THE QUICK SYNC

  • Financial regulators have called out the risks poses by a group of hedge funds with “very high levels of synthetic leverage”. (Financial Times)

  • Apple has struck a deal with chipmaker Arm that runs through to 2040. (CNBC)

  • America’s regional banks are more exposed to commercial real estate than previously thought. (WSJ)

  • Evergrande has soared 70% after Country Garden avoids default. (CNBC)

  • WeWork will renegotiate most of its office leases after a “period of unsustainable hypergrowth”. (Financial Times)

  • Universal Music has struck a major streaming deal with Deezer to overhaul music royalties. (Financial Times)

TRADING FLOOR

M&A:

  • Winson Group's founding family seeks an exit, with PwC advising potential buyers to consider the company's $208m revenue for the current fiscal year. (AFR)

  • Ventura Group is reportedly attracting attention from a minimum of two foreign suitors, despite concerns regarding its ability to secure lucrative government contracts beyond 2028. (AFR)

  • Bendigo and Adelaide Bank has been actively looking to sell its significant Homesafe business, valued at $950m. (AFR)

  • Julian Peck has wasted no time in pursuing significant deals including Albemarle‘s Liontown Resources bid and BHP’s acquisition of OZ Minerals this week. (AFR)

  • Commonwealth Bank has acquired Waddle, taking over the business just six months after its previous owner nearly wrote down its carrying value to zero. (AFR | BNA)

  • Vicinity Centres has successfully sold the Broadmeadows Homemaker Centre for $20m. (SMH)

  • TPG Capital is gauging interest in Greencross, the owner of Petbarn. (The Australian)

  • Stanmore Resources seems to have withdrawn from the competition for BHP's Daunia and Blackwater coal mines, possibly due to an offer that is considered too conservative. (The Australian)

Capital Markets:

  • JPMorgan's equity desk executed a $47m trade in Paladin Energy's shares. (AFR)

  • Orora's shares are currently trading above the price at which they were offered in this week's equity raising, despite being sold at a substantial discount. (The Australian)

  • Small cap personal lender Harmoney is shopping around for new funding for its loan book. (Capital Brief)

VC:

  • Abbl has achieved unicorn status after winning Scalapay's inaugural $10,000 Scale Up Scholarship. (Startup Daily)

Others:

  • The once-hot buy now pay later sector is now facing an existential crisis. (Capital Brief)

  • Michael Cook, an executive at Investa, has left the company at a time when the office sector is experiencing significant changes. (The Australian)

  • Macquarie revises its outlook as asset sales are pushed to the second half. (AFR)

  • Upstreet has closed its doors just 17 months after securing a $3m investment from backers. (AFR)

THE WATERCOOLER