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this past week, the Federal Trade Commission cited a “yearslong course of anticompetitive conduct.” The FTC wants the company to divest Instagram and WhatsApp, two acquisitions that the commission signed off on years ago. Facebook called the effort “revisionist history” and said that it would send a “chilling warning to American business that no sale is ever final.”
Don’t feel too bad for corporate deal makers, though. Investment bankers are a hearty bunch who have persevered for decades. Even after the FTC announced in February that it was investigating past acquisitions by Google parent
the companies have continued to explore—and make—substantial deals.
This summer, Microsoft sought and received approval from the Trump administration to acquire TikTok, a deal that it eventually dropped. This year, while under a global regulatory microscope, Facebook has made seven acquisitions, according to FactSet, roughly in line with its recent history. In May, Facebook acquired Giphy, a collection of images and animations meant to enhance Instagram, for a reported $400 million. Just last month, the social network said that it was buying Kustomer, a maker of customer-service software, for an estimated $1 billion. That’s the same price Facebook paid for Instagram back in 2012.
Until a court says otherwise, Big Tech will continue to swallow up the small fish. There’s no chill in the air.
No Sign of Relief
Stocks opened the week down, then the S&P hit its 30th high for the year. The dollar continued to weaken, as investors looked beyond the U.S. for a vaccine-driven global recovery. Tesla said it would sell $5 billion new shares, the second time since September, and the shares sold off. Stocks flagged as the relief bill stalled and unemployment benefits rose. For the week, the Dow industrials slipped 0.6%, to 30,046.37; the S&P 500 lost 1% to 3663.46; and the Nasdaq Composite shed 0.7%, to 12,377.87.
Finally, a Vaccine
The Food and Drug Administration rushed to approve the
and BioNTech Covid-19 vaccine, the first in the U.S., after the agency was told by the White House to speed up the process. Trump lawyer and former New York City Mayor Rudolph Giuliani tested positive for Covid and was hospitalized. Despite broad agreement about the need for a relief bill, talks stalled over direct payments, state and local aid, and liability protection. The Covid death toll neared 290,000, with deaths topping 3,000 on Wednesday and Thursday.
The Health Team
The Biden transition introduced a health team: Dr. Rochelle Walensky of Massachusetts General to run the Centers for Disease Control and Prevention, California Attorney General Xavier Becerra for Health and Human Services, and former Obama Surgeon General Vivek Murthy in the same job. Biden also nominated retired four-star General Lloyd Austin to run Defense—the first Black American to oversee the Pentagon. Separately, the Supreme Court refused to take up a Pennsylvania suit to overturn the election.
Brexit on the Edge
Gloom hung over Brexit talks between the U.K. and European Union, with Prime Minister Boris Johnson racing to Brussels to negotiate over dinner. Both sides said they would decide the future of talks on Sunday. Issues like fisheries, state aid, and enforcement persist. The Dec. 31 deadline looms.
IPOs Go Ka-Boom
priced its initial public offering above its range at $102 a share, then rose 86% after its debut, closing at $189.51 for a $70 billion valuation. Then, the long-awaited IPO of
priced at $68 and closed at $144.71, up 112.8% for a $100.7 billion valuation.
Annals of Deal-Making
received bids for DirecTV valuing it at over $15 billion…Activist Engine No. 1 is seeking four of
10 board seats, arguing that Exxon needs to focus on clean energy…
shifted gears on self-driving car efforts, swapping its unit for a minority stake in
and Sequoia-owned Aurora…The Federal Trade Commission and 46 states filed antitrust suits against
The FTC took aim at Facebook’s acquisition of Instagram in 2012 and WhatsApp in 2014…Zurich Insurance to buy
U.S. property and casualty unit for $3.9 billion.
Write to Max A. Cherney at [email protected]