Andrew here. We’re taking a look at Anthropic’s latest steps toward an I.P.O. that appears set for this fall, Stripe’s takeover plan for PayPal, and BlackRock’s $15.3 trillion — with a “t” — in assets under management. More below.
The next big A.I. offering?
The race to be the next artificial intelligence giant to go public is on, and all signs point to the A.I. lab Anthropic.
It is reportedly taking the kinds of steps a company would if it were preparing for a potentially trillion-dollar I.P.O. in the fall. That timeline would put Anthropic ahead of rivals — but comes amid an uncertain outlook for the company.
What’s happening:
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Banks advising Anthropic are lining up meetings with potential investors in the coming weeks, Bloomberg reported, citing unnamed sources.
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Anthropic is in talks to arrange more credit lines from banks, many of which would become underwriters for its I.P.O., according to The Information. (The A.I. lab is already working with Morgan Stanley, Goldman Sachs and JPMorgan Chase.)
All this suggests an I.P.O. in the fall is in the offing. Anthropic has already filed confidentially for an initial offering, and Bloomberg previously reported that the company might go public as soon as October.
That timeline would put Anthropic squarely ahead of OpenAI, which has also filed confidentially but is now looking at going public next year. And DeepSeek, one of its fast-growing Chinese rivals, is weighing an I.P.O. in China as soon as next year, according to Bloomberg.
Some in Silicon Valley have worried about falling behind in the I.P.O. race. Going later might mean ceding some investor capital to competitors that went public beforehand, the thinking goes.
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That said, business fundamentals often trump timing. Consider how Uber’s stock has vastly outperformed that of Lyft, its longtime rival, despite the company’s going public second.
Several significant questions hang over Anthropic. The company is still battling the Pentagon in court over its designation as a supply chain risk to national security.
Its relationship to the rest of the Trump administration remains uncertain, even since it struck concessions that allowed it to rerelease its Fable A.I. model following restrictions imposed by the Commerce Department.
And the company’s leading A.I. models remain vulnerable to pricing pressure from OpenAI and other Western labs as well as open-source Chinese ones, especially among cost-conscious users.
In other A.I. news:
HERE’S WHAT’S HAPPENING
The F.C.C. prepares to repeal the audience cap for TV broadcasters. The agency’s chair, Brendan Carr, said the regulator would replace the blanket restriction — currently set at reaching 39 percent of U.S. households — with case-by-case evaluations. The move could usher in more consolidation of the TV broadcast industry.
TSMC plans another big investment in the U.S. amid blockbuster earnings. TSMC, a major Taiwanese chipmaker, reported a 77 percent year-on-year jump in quarterly profit on Thursday and said it would invest another $100 billion in chip factories in Arizona. The company has benefited from a scarcity of A.I.-related chips; that shortage also has Apple weighing takeovers of semiconductor start-ups, according to The Information.
Todd Blanche’s nomination as attorney general is uncertain after his Senate confirmation hearing. Blanche, who holds the role in an acting capacity, faced tough questioning from Senator John Cornyn, the Texas Republican who lost a primary to a Trump-backed challenger, as well as Democrats. Much of the grilling revolved around Blanche’s role in setting up a nearly $1.8 billion fund for people the Trump administration says are victims of Justice Department persecution; a single Republican “no” vote would sink Blanche’s nomination.
Why does Stripe want PayPal?
Stripe is already one of the biggest financial technology companies around. Now it’s seeking to buy one of its embattled forebears, PayPal.
A $53 billion takeover offer by the payment upstart Stripe and the investment firm Advent International is one of Stripe’s most ambitious moves yet. (It’s rare to see a privately held start-up bid for a publicly traded rival, though Stripe is significantly bigger, with a $159 billion valuation.)
But many on Wall Street are speculating about whether it can pull off this megadeal.
The offer’s details, according to The Times’s reporting:
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Stripe and Advent have bid about $60.50 a share, 28 percent above where PayPal was trading before Reuters broke the news of the proposal.
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The two suitors have about $50 billion in committed bank financing.
What Stripe and Advent would get: Stripe is the leader in e-commerce processing, handling $1.9 trillion in payments last year. (PayPal handled $1.79 trillion that year.) Buying PayPal could give Stripe yet more customers, especially on the consumer side of payments, as well as PayPal’s competing Braintree division.
Advent has struck several notable payment-related deals over the years, including the $6.3 billion buyout of Nuvei of Canada and a $430 million investment in EBANX of Brazil.
Not everyone is sold on the deal. True, PayPal has been losing momentum, struggling to compete against Apple, Google and, yes, Stripe. In February, it announced plans to replace its C.E.O. with Enrique Lores, the former chief of HP; it has also retained Goldman Sachs and Evercore to explore its strategic options, according to Bloomberg.
But the Stripe-Advent offer is still well below where PayPal has traded over the past five years. Analysts at William Blair described it on Wednesday as “lowball” and questioned its industrial logic. Shares in PayPal closed on Wednesday below the offer price, suggesting some investor skepticism that it will go through.
What’s next? PayPal’s board is set to meet as soon as Monday to formally discuss the offer, according to CNBC.
It’s not clear whether PayPal would be open to being sold at all. But Martin Peers of The Information suggests that another company might come knocking: SpaceX, which wants to bulk up its payment offerings and could benefit from PayPal’s steady cash flow — and whose leader, Elon Musk, was a founder of PayPal.
Quote of the day
“I found nothing in there that was beyond what I could picture myself doing.”
Warren Buffett, talking to CNBC about Bill Gates’s ties to Jeffrey Epstein. Buffett, who excluded the Gates Foundation from his annual charitable donations this year, said that while he found his longtime friend’s relationship with Epstein “distasteful,” he could envision himself making similar mistakes when picking associates.
BlackRock diversifies its way to an asset bonanza
BlackRock, the world’s biggest investment management firm, just got even bigger: It now oversees a staggering $15.3 trillion in assets.
The achievement underscores just how well BlackRock has adapted to the changing nature of global markets and profited from it, including by capturing private investments and actively managed assets.
A flood of new client money bolstered BlackRock’s results. The company reported $192 billion in net inflows during the second quarter and a record $321 billion in the first half of the year. That helped push up its organic growth from base fees by 10 percent for the quarter.
“They’re an asset-gathering machine,” Steve Sosnick, chief strategist at Interactive Brokers, told DealBook.
Surging markets have also benefited the firm as investors have poured more capital into money managers like BlackRock. (That rising tide also bolstered Wall Street banks: The six biggest reported a collective $49 billion in profits, driven by big I.P.O.s and a spike in trading.)
BlackRock executives talked up the firm’s evolving approach to markets, which has involved adding complements to the asset manager’s longtime strength in index funds.
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Actively managed funds made up $53 billion of client inflows in the second quarter.
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Private markets and liquid alternatives together made up about $22 billion worth of inflows for the period, up 50 percent year on year.
“BlackRock is simultaneously a leading public markets manager, a skilled private markets platform and a global technology company,” Larry Fink, the firm’s co-founder and C.E.O., told analysts on Wednesday. “That’s a model built to deliver sustained growth.”
Private credit has been a particular focus. Last year, BlackRock paid $12 billion to buy the lender HPS Investment Partners. For the quarter, the firm reported $6 billion in private credit inflows.
That said, BlackRock hasn’t been immune to a downturn in the sector, with HPS having capped investor withdrawals amid a flood of redemption requests.
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Still, Martin Small, BlackRock’s C.F.O., told analysts on Wednesday that he saw “incredible opportunities” in the industry.
The firm is continuing to look for the next big thing. The effort may include so-called tokenization, in which stocks, bonds and other assets are turned into digital tokens. That could unlock fractional ownership of those securities and make trade settlement times much quicker and available around the clock.
BlackRock is one of nearly 40 firms that plan to tokenize a batch of securities held at the Depository Trust & Clearing Corporation, according to The Wall Street Journal.
THE SPEED READ
Deals
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Chancellor Friedrich Merz of Germany said he would not try to stop UniCredit, the Italian lender, from acquiring Commerzbank. (Bloomberg)
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Eli Lilly plans to buy AtaiBeckley, a maker of experimental psychedelic treatments for depression, for $2.8 billion. (CNBC)
Politics, policy and regulation
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Tech entrepreneurs and investors who say they left California before a vote on the state’s proposed “billionaire tax” will probably face an aggressive investigation into where they live. (FT)
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“The A.I. Backlash Has Tech Executives Fearing for Their Lives” (WSJ)
Best of the rest
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