It’s Over

Together with

Good Morning,

Jensen Huang got honeypotted by a hot Chinese spy, Big Tech stocks got cooked after rare earnings misses, KOSPI halted trading again, Druckenmiller made his first X post to announce an investment in a Hyperliquid venture, and Binance got hacked hours later for $6.3B in what may be the biggest heist of all time.

It's over.

Today's letter is brought to you by F2, which just launched Adam 2.0, a deal agent custom-fitted to your firm's templates, precedents, and IC standards, up and running in 48 hours. See it on your own deals. Try a demo.

Let's dive in.

Before The Bell

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Markets

• US stocks slipped yesterday as Big Tech names posted rare earnings misses in a reckoning for the AI trade

  • S&P snapped a three-day win streak

  • Google fell 13% in its worst day ever

• Korea's KOSPI index plunged 5%

• CDSs on tech names rose to record highs

• Spreads between the best and worst junk-rated bonds in Europe surged to the widest since 2009

• European gas prices surged above €100/MWh for the first time in four years

• N*gga Its Over ($NIO) memecoin surged 180% after Binance was hacked in the biggest heist of all time

Earnings

• Amazon sunk 12% after it missed Q3 earnings and revenue estimates on $42B of negative FCF due to aggressive AI capex even as cloud revenue surged 40% to $46B (CNBC)

• Intel plunged 20% despite beating Q3 earnings and revenue estimates as it gave weak Q4 guidance due to a PC market slowdown (CNBC)

• Coinbase posted its first quarterly profit this year as crypto investment gains offset weakness in trading (RT)

• Reddit sunk 20% despite beating Q3 earnings and revenue estimates as it gave weak Q4 guidance as Google search traffic shrinks (CNBC)

• Starbucks missed Q4 revenue estimates but says its turnaround continues to take hold with 7.7% same-store sales growth in America (CNBC)

• Eli Lilly issued a blistering Q3 beat-and-raise on soaring demand for obesity drug Zepbound and diabetes treatment Mounjaro and room for 'dramatic' obesity market expansion (CNBC)

• What we're watching this week:

  • Today: ExxonMobil, Chevron

• Full calendar here

Prediction Markets

• Excluding North Koreans, it's so over for everybody. Stocks, bonds, crypto, doesn't matter. Might just be cooked

• Sign up to trade on the Polymarket US app with code LIT and they'll send you a $25 bonus

Headline Roundup

• US GDP grew 3.4% YoY in Q3 (CNBC)

• Fed-favorite PCE index rose 3.6% YoY (CNBC)

• ECB held rates steady at 2.5% (CNBC)

• Christine Lagarde will resign as ECB president (WSJ)

• Warsh's 'forward silence' risks bigger Treasury market swings (BBG)

• Big Tech's $750B AI bet collides with slowing core growth (BBG)

• $300B 'debt wall' looms over PE backed companies (WSJ)

• BlackRock's bond CIO spent weekend investing in AI debt deals (BBG)

• Ares is avoiding backing AI chips (BBG)

• Druckenmiller made X post debut announcing investment in perps firm (X)

• Evercore average pay is set to hit $1.2M this year (EFC)

• One-third of all SpaceX revenue comes from Anthropic (BBG)

• Musk may get $X ticker in SpaceX-Tesla merger (BBG)

• Hot Chinese spy honeypotted Jensen Huang (NYT)

• Churches are turning their land into affordable housing (WSJ)

A Message from F2

Adam 2.0 works the way your firm does, and gets better with every deal.

Firms adopting AI for deal work have had two options: buy an off-the-shelf tool that treats every lender the same, or spend years building their own. Adam 2.0 is the third. It takes on how your firm already works from day one and keeps improving with each deal:

• Your standards: your templates, formatting, and house style, applied automatically

• Your workflows: multi-step deal work, from a forwarded CIM to a first-pass screening memo

• Your knowledge: your precedent deals and how your firm underwrites, on every new deal

• Your feedback: every correction makes the next output better

"F2 is the rare tool that actually delivers on the promise of efficiency. It accelerates our turnaround times while ensuring every underwriting file meets the same high standard," says a MD at a $17B commercial bank

Up to 5x faster than before, with unlimited usage and zero data retention.

Email Adam your next deal.

Deal Flow

M&A / Strategic

• Shareholders voted against Italian lender BMPS' bids for $25B-listed peer Banco BPM and $8.5B-listed private bank Banca Generali which were meant to fend of a $37B hostile bid from peer Intesa; shareholders also rejected a merger with $24B-listed Mediobanca

• Czech defense billionaire Michal Strnad offered to acquire to Delfin, the family investment company behind Italian eyewear giant EssilorLuxottica, for $33.5B

• DoorDash agreed to buy rival Instacart at a $17B valuation for a 25% premium

• German chemicals company Evonik will reject peer BASF's improved $12.3B takeover offer as too low

• Ray-Ban heir Rocco Basilico rejected his brother Leonardo Maria del Vecchi's $3.9B offer for his 12.5% stake in Delfin

• Thrive Holdings, the permanent capital vehicle of Josh Kushner's Thrive Capital, agreed to buy home security provider ADT for $15.3B, including debt, at a 35% premium

• $440M-listed Applebee's and IHOP franchisor Dine Brands Global adopted a poison pill to fend a takeover from Cobblers Cove Capital and Arkhouse Management

• East Timor will acquire Woodside Energy's 33% stake in the Greater Sunrise gas fields off Australia for $200M

• MeridianMade, a contract manufacturing firm led by the brother-sister co-founders of controversial baby-formula maker ByHeart, will buy Perrigo's infant-formula business for $175M

• Brazilian biofuels maker Raizen is selling part of its fuel distribution business; shareholder Shell will get a 20% stake

• South Africa regulators approved PE firm Harith General Partners' deal to acquire budget carrier FlySafair

• Mazarine Energy will acquire Romanian offshore natural gas producer Black Sea Oil & Gas from Carlyle and EU's EBRD

• Salesforce will buy defense technology firm ​Rune Technologies

• Communist Vietnam will retain full ownership of Vietnam Electricity and PetroVietnam and maintain its stakes in 13 other strategic enterprises through 2030

VC

• AI hedge fund Situational Awareness is raising money from investors to invest in neo-cloud startup Fluidstack at a $40B valuation

• Kalshi raised a $1B Series G at a $40B post-money valuation co-led by Wellington and Sequoia

• Canadian AI startup Cohere is raising a $5B Series E at a $25B valuation from Schwarz Group, Bell Ventures, Bullhound Capital, Canada,, Nvidia, and others

• AI enterprise automation startup Serval raised $150M Series C at a $3B valuation led by Sequoia

• NVision, a German quantum startup developing molecule-based qubits, raised $120M from government and private investors including Abbott Laboratories

• Collective, the AI-native financial operating system for solopreneurs, raised $100M including a $40M Series B led by General Catalyst, QED Investors, and Gradient Ventures

• Solink, a visual analytics company turning existing security cameras into business intelligence, raised $100M in a new funding round led by Vertu Capital

• Wabi, an AI agent that builds mini apps/personal agent, raised $55M at a $1.25B valuation led by IVP

• Opentrons, an open, AI-native laboratory automation company, raised a $40M Series E led by healthcare investor Avego

• PhotonPay, a stablecoin-centric financial OS fintech, raised a $40M Series C led by Blockchain Capital

• Bites, an AI-native frontline performance enablement platform, raised a $40M Series A led by PeakSpan Capital

• SuperMe, a network of AI expert profiles, raised $20M in funding led Forerunner

• Dream, a startup developing built world models for construction, raised a $17M seed round led by a16z

• Crux Labs, an enterprise AI agent evaluation platform, raised a $6M round co-led by Benchstrength and Misneach

Access the complete VC deal flow and data on Fundable

IPOs / Listings / Issuances / Block Trades

• Chinese chip suppliers Denglin Technology and Hosin Electronics, chip packaging company Xinde Semiconductor, Hemay Pharmaceutical, RelyEZ Energy Storage Technology, and Neautus Traditional Chinese Medicine launched Hong Kong listings seeking to raise a combined $765M

• Malaysia's largest pharmacy chain Big Caring is set to raise $560M at a $2B valuation in Malaysia's second-biggest IPO this year

Debt

• Microsoft drew $115B in orders for a $25B bond sale, its first in a decade

• Indian AI infrastructure firm AM Intelligence is seeking to raise $3B to fund a purchase of Nvidia chips

• CPPIB-backed Indian real estate developer RMZ Corp. is seeking to raise $500M in private credit from Bain Capital to fund expansion

• HSBC is looking to offload data center credit risk to insurers

Bankruptcy / Restructuring / Distressed

• Asian PE firm PAG agreed to acquire 51% of the property management arm of collapsed developer China Evergrande for $513M and the remaining 49% after the deal closes in Evergrande's largest asset sale yet in its liquidation

• Brookfield invested $214M for a 40% stake in private members club Maison Estelle months before it was forced to close amid allegations of threatening behavior

• UK discount retailer Poundland began insolvency proceedings just one a year after it was bought by Gordon Brothers for $1

• Big Law firm Weil, Gotshal & Manges hired AlixPartners and Davis Polk to advise on its wind-down

Funds / Secondaries

• Ares raised $6B at first close for its fourth flagship private credit fund and $2B for an adjacent open-ended fund

• De-carbonization PE firm Ara Partners raised $2.5B for its debut energy fund

• MM PE firm Monomoy Capital Partners raised $2.25B for its fifth fund and $500M for its debut lower MM fund

• Real estate investor Town Lane raised $1.9B for its second real estate fund

• MM PE firm FFL Partners raised $1.35B for its sixth fund

• VC FOF Vintage Investment Partners raised $920M across its VC and secondaries strategies

• Ascertis Credit raised $700M for a targeted fourth private credit fund

• Formation Bio, a biotech venture backed by Sequoia, a16z, Sam Altman, and Thrive, raised a $600M fund to invest in AI-powered drug developers

• Mediobanca-owned credit manager Polus Capital Management raised $600M for its second special situations fund

• Private credit firm Foundation Credit raised $540M for its second infrastructure credit fund

• CVC raised $500M for its debut credit secondaries fund

• Mettle Capital, the new VC firm of three former Sequoia India partners, raised $350M for a debut fund

• Japanese lender SMBC bought a minority stake in Indian PE firm One Planet Partners and will anchor its debut $315M fund

• Bison Ventures raised $160M for its second fund to invest in frontier tech

• Dutch PE firm HC Partners raised $112M for its third fund

Crypto Sum Snapshot

• Binance was hacked $6.3B in what may be the largest heist of all time

• Crypto exchange HTX will exit UK after being sued by watchdog

• ICE's tokenized stock plan hits hurdle as big companies object

Crypto Sum compiles the most important stories on everything crypto. Read it here.

Lit's Picks

• WSJ published a short analysis on the 40+ stock portfolio of our taxpayer dollars. Managed by none other than Donald Trump…

• WSJ also published a profile on the four academics behind California's billionaire tax. Editors opinion: they're not the sharpest in the shed.

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