Carl Icahn’s Proxy Fight With Illumina Comes to a Vote

Is Mr. Icahn on the verge of a big win?

One of America’s biggest corporate battles comes to a head on Thursday. Shareholders of gene-sequencing giant Illumina will vote for either the company’s incumbent board members or a candidate nominated by billionaire Carl Icahn.

A board battle involving one of Wall Street’s top activist investors is significant in and of itself. But there’s a lot more going on here, including acquisitions that will test antitrust regulators on both sides of the Atlantic and new power of attorney rules that could reshape corporate governance in the United States.

A $7 billion deal with Grail is a big factor in the fight. Icahn criticized Illumina’s efforts to complete the acquisition of the cancer-detection company despite the European antitrust authority’s decision to block the deal and the FTC’s objections, calling it “baffling and inexcusable.” ‘ said. Other shareholders might agree, considering Illumina has lost $50 billion in market cap since the August 2021 acquisition announcement.

Illumina dismissed European objections, claiming that Grail has no revenue or business in Europe. It is part of a broader backlash against ambitious and often coordinated efforts by global antitrust regulators to curb large-scale M&A.

This contest is also a test for universal proxies, New SEC rules to make it easier for shareholders to vote for different candidates. Icahn has fielded three candidates to challenge incumbent directors, including Illumina CEO Francis D’Souza and Chairman John Thompson. (He argued that the two were too close.)

Mr. Icahn has a good chance of winning the seat. Influential shareholder advisory firms offered some support for the campaign. Institutional Shareholder Services has endorsed Icahn’s nominee Andrew Tenno over Thompson for a more independent chair “as the company navigates certain controversial management decisions.” would have provided a better balance.And Glass Lewis endorsed two candidates for Icahn over Thompson. and Mr. De Souza.

may be enough to guarantee that At least one of Mr. Icahn’s candidates, probably Mr. Teno will win on Thursday. (Illumina offered Icahn a board seat as part of the initial settlement, but activist investors refused.)

But Icahn himself still faces pressure elsewhere. The billionaire is at odds with short-selling firm Hindenburg Research, which claims Mr. Icahn’s public investment vehicle is overvalued and that he relies on the sale of new shares to pay for his dividend. (Bill Ackman, former enemy of Icahn, weighed again As for Wednesday’s fight, it suggests that Icahn’s company’s stock could fall further.)

Icahn dismissed Hindenburg’s accusations as a “disinformation campaign,” but his company is now facing government scrutiny and its stock has fallen more than 50% in the past month.

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It turned out that TikTok was freely sharing user data internally. Employees of the video app regularly posted sensitive information, including identities and photos, to an internal messaging tool that could be viewed by Chinese parent company ByteDance and The Times’ Sapna Maheshwari and Ryan Mack. . The revelation could be another headache for TikTok, as it faces scrutiny in Washington and a ban in Montana.

Fitch has warned it could downgrade US debt. The rating agency gave a national AAA rating under negative watchThe political stalemate over raising the debt ceiling makes default more likely. The chief U.S. economist at JPMorgan Chase expects the dispute could go beyond the so-called X-date, which drains government funds. at 25 percent.

Fed officials are unsure whether to continue raising rates. Minutes of the Central Bank’s Last Interest Rate Setting Meeting He indicated that opinions were divided on whether higher interest rates were necessary to keep inflation under control. This could suggest that investors are becoming more dovish ahead of the Fed’s next rate hike meeting in mid-June.

Shareholder advisers recommend removing Alphabet’s chairman. Proxy advisors Institutional Shareholder Services and Glass Lewis suggest to investors: dismiss two directors Including John Hennessey, chairman of Google’s parent company. There have been calls for Alphabet to overhaul its corporate governance, but it’s unclear whether shareholders will agree.

Microsoft has warned that Chinese-backed hackers have compromised critical U.S. infrastructure. A state-backed group is working to disrupt “critical telecommunications infrastructure between the United States and Asia” from 2021, the tech giant announced Wednesday. U.S. officials fear the intrusion is intended to undermine U.S. efforts to help Taiwan prepare for a Chinese attack.

Twitter Fails Big Political Moment

Hosting Ron DeSantis’ official presidential campaign announcement should have been a win for Twitter, as Elon Musk seeks to make the social network a major player in politics and media. However, the live audio event was marred by over 20 minutes of technical glitches, costing more than half of the original audience. (Mr. Musk later said, “It was insane, sorry.”)

The incident once again raises questions about Twitter’s system as it looks to once again lure advertisers and realize Musk’s ambitious vision.

Twitter employees feared misfiresRyan Mack of The Times reports: Employees panic when Twitter’s systems crash due to an influx of over 600,000 listeners because there was no plan for “site credibility issues” I had no choice.

Questions about the reliability of Twitter’s infrastructure have haunted the company for months after Musk began massive layoffs, including backend engineers, and shut down data centers. The site experienced at least four outages in February, compared to nine outages in 2022 as a whole.

None of these are likely to win the favor of advertisers, many of which have shunned Twitter since Musk’s acquisition, citing concerns over content moderation and other issues. While some companies are considering a tentative return, especially following the appointment of former NBCUniversal head of advertising Linda Yaccarino as CEO, new questions about credibility have emerged. , is another reason to keep a certain distance.

AI boosts Nvidia stock price

Nvidia’s shares set a record in pre-market trading on Thursday after chip makers delivered unexpected sales forecasts on the back of demand for processors that run artificial intelligence systems.

“We have an incredible order to refurbish our data centers around the world.” Nvidia CEO Jensen Huang told analysts on Wednesday. (His GPU chips from his company are used to power his AI systems and were previously in great demand) during the cryptocurrency boom, that system also relies on processing power. ) Nvidia market capitalization reach $755 billion Fifth highest public valuation in the U.S. as of Wednesday’s market close

Other chip stocks, such as AMD, ASML and Taiwan Semiconductor Manufacturing Company, also rose on the rise of AI.

But analysts disagree about how long the rally will last. Bank of America’s Michael Hartnett called the rise “baby bubbleMeanwhile, researchers at Goldman Sachs said tools built on generative AI could help boost global GDP. $7 trillion increase.

Other AI News:

• Reid HoffmanThe billionaire LinkedIn co-founder has emerged as one of Silicon Valley’s biggest AI evangelists and deal makers.

• After meeting with European Union officials on Wednesday, Alphabet CEO Sundar Pichai said Google is working with other companies to Develop AI services responsibly.

• Starting in July, New York City will require companies that use AI to recruit candidates to provide information to candidates under a new law that has drawn the attention of labor rights advocates.

“This is what the recession looks like. There used to be about 20 of them.”

— an anonymous guest quoted by The Wall Street Journal at a star-studded party co-hosted by Warner Bros. Discovery’s David Zaslav and editor Graydon Carter. pointing to two huge yachts Docked near Cannes, France.

JP Morgan fights back over Epstein scandal

JPMorgan Chase has hit back with an impending civil lawsuit against the Wall Street giants against victims of sex offender Jeffrey Epstein.

US Virgin Islands prosecutors have accused JP Morgan of aiding the trafficking and sexual exploitation of Epstein, a financier and longtime client of the bank who died in 2019.in legal claims submitted on wednesday The bank said in federal court in Manhattan that government officials from the islands assisted Epstein in the crime.

“In exchange for Mr. Epstein’s cash and gifts, the USVI made his life easier.” Lawyers for JP Morgan wrote in the complaint: They said the government “ensured that no one asked too many questions about his transfer to the island and the rearing of the young girls.” The bank said that while island officials made “decades of rewards” for Mr. Epstein, receiving favors and political contributions, and giving millions of dollars in tax benefits, “Epstein’s criminal activities It fostered the perfect conditions to continue undetected.” “

JP Morgan is seeking permission from the court to delve into the island government’s alleged complicity and bring it forward as a defense in court.

Prominent figures in the case are expected to be sacked within days. The two-day deposition of bank CEO Jamie Dimon is set to begin on Friday. June 6th is USVI Governor Albert Bryan Jr.’s turn.

In a related lawsuit, Deutsche Bank last week agreed a $75 million settlement with victims who accused the bank of aiding Epstein’s further crimes. Victims’ attorney David Boyes argues that JPMorgan’s relationship with Epstein is broader and more permanent, and that resolution could be more costly.

Lawyers for Jess Staley will also be present at Dimon’s deposition. In March, JPMorgan filed a lawsuit against a former executive, blaming his relationship with Epstein for deteriorating banking relations. Staley was just hit Wednesday when a judge denied his efforts to dismiss the lawsuit against him.

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