One amazing read to start: What were two Chinese women doing in a rented mansion in London with an astronomical amount of cryptocurrency? The FT investigates.
Plus, one scoop: Shari Redstone, Paramount’s controlling shareholder, is unconvinced by an $11bn offer from Apollo for its Hollywood studio, people briefed on the matter said, and is instead negotiating a rival deal with billionaire David Ellison to secure the future of her family’s media empire.
In today’s newsletter:
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Microsoft’s new, stealthier dealmaking technique
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The man behind a major private credit shake-up
ChatGPT: write an antitrust strategy
When it comes to corporate strategy, humans may still have the edge over ChatGPT — especially Microsoft chief executive Satya Nadella.
The $3tn Seattle tech giant is quickly cornering the talent market in the global race to lead the development of artificial intelligence. But it is doing so in a careful manner to avoid trouble from antitrust regulators.
Microsoft’s latest move came on Tuesday, when it announced the surprise hiring of Mustafa Suleyman, the co-founder of Google’s DeepMind and chief executive of artificial intelligence start-up Inflection, to run a new consumer AI unit called Microsoft AI.
It’s quite an unusual story. Suleyman, a British entrepreneur who co-founded DeepMind in London in 2010, had just raised $1.3bn from Microsoft, Nvidia and other investors at about a $4bn valuation for his new venture Inflection last June.
And not only is Microsoft lifting Suleyman off his perch running Inflection, but it will also hire most of Inflection’s staff including its chief scientist.
Inflection’s financial backers could be forgiven for being miffed after they poured in billions of funding only to see the CEO Suleyman leave. The start-up’s co-founder and LinkedIn executive chair Reid Hoffman wrote on social media that “all of Inflection’s investors will have a good outcome today”, without disclosing details of the arrangement.
But the best outcome may be for Microsoft, which can now add Suleyman and Inflection to its stable of AI bets with a lesser risk of tripping the wires of competition regulators.
Microsoft built a leading edge in AI by becoming the primary partner of the ChatGPT-maker OpenAI. But it has also sought to tie itself closely to other promising AI start-ups such as France’s Mistral via a recent investment and “multiyear partnership”.
The moves are about winning the battle for talent, and ensuring that it is Microsoft’s platforms — and particularly its cloud unit Azure — at the forefront of the technological shift.
Hiring teams from Inflection — and forging minority investments and commercial partnerships — will bind start-ups and talent to Microsoft and its ecosystem, without raising the classical competition concerns that traditional acquisitions might.
Suleyman’s hiring was “basically an acquisition of Inflection without having to go through regulatory approval”, wrote Tony Wang, managing partner at venture capital firm 500 Global.
Microsoft and Inflection have stressed the agreement is not an acquisition and Inflection remains an independent company.
Despite making these agreements rather than full acquisitions, its dealings with start-ups are likely to attract the attention of regulators, say analysts. Competition watchdogs are already probing Microsoft’s multibillion-dollar alliance with OpenAI.
However, given Microsoft’s history with antitrust regulators (see: Activision Blizzard) the company may have some clever intelligence of its own.
The unlikely corporate raider
In December 2020, veteran property executive Paul Weightman retired from the Australian real estate business he had founded more than two decades before.
Just over three years later, he has landed back in finance with a splash. Weightman is the unlikely figure behind what has been described as “one of the largest corporate raids” in asset management history, the FT reports.
Weightman’s Corinthia Global Management — an investment firm he set up in 2022 and which lists just one other employee on its website — announced it had poached more than 20 senior executives from the $381bn asset manager Barings, a subsidiary of US life insurer MassMutual.
What makes it even stranger is that his new business isn’t even focused on what he spent a large part of his career doing: property. Instead, the 62-year-old Weightman is, in his own words, seeking to “redefine the private credit landscape”.
His attempt at doing so has sent shockwaves through the $1.7tn private credit market which remains dominated by a fairly small group of players, among which Barings was included.
The chaos began on March 8 when the Barings group resigned en masse. The resignations were swiftly followed by an email Weightman sent to MassMutual’s chair Roger Crandall, asking to speak.
Weightman followed up the next morning offering to take over the running of the business he had just helped upend. The offer was quickly rejected but Weightman continued his recruitment drive among Barings’ staff.
Earlier this week, Barings fired back. The asset manager filed a lawsuit against Corinthia and two of its departing executives. It has also told its clients it is pausing investments in some of its funds, a sign of the damage wrought by the raid.
For Weightman and Corinthia, their ambitions remain undimmed. But they are steering clear from Barings as a source of new recruits.
“We are continuing to advertise and recruit for positions in the US, UK and Australia, although we are not soliciting any additional employees from Barings,” Corinthia said.
Job moves
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UBS has named Alexandra Avramopoulos and Patrick Klotz as co-heads of global banking for Germany and Austria, taking over from Philip von Malsen-Plessen, who will become a vice-chair of global banking in Emea.
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Deutsche Bank has appointed Michael Hufton to be co-head of its infrastructure and utilities unit for the Asia-Pacific region, according to Bloomberg.
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Simpson Thacher & Bartlett has added Paul Hibbert and Emma Serginson to its London office as partners focused on financing and credit across the infrastructure sector. They join from Weil, Gotshal & Manges.
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Brunswick, the public relations firm, has hired Michaela Browning as a partner and chief executive of Asia-Pacific. She joins from Google, where she was the regional head of government and public policy for Asia-Pacific.
Smart reads
Dog fight Insurers and owners are in a battle over who pays for the planes stranded at the start of the Ukraine war, The Wall Street Journal writes.
The blazing furnace An embezzlement case involving ghost companies and bribes to central bank officials is threatening to upset foreign investment in Vietnam, the FT reports.
Risky business The US is pressing Austria’s Raiffeisen Bank International, the biggest western bank in Russia, to drop plans to buy a €1.5bn stake from a Russian tycoon, Reuters writes.
News round-up
Reddit prices shares at top end of IPO range (FT)
Gucci owner Kering’s shares tumble 12% on profit warning (FT)
Billionaire John Paulson to hold megadonor fundraiser for Donald Trump (FT)
Temu-owner PDD doubles revenues to cap ‘pivotal’ year (FT)
Raiffeisen pulls AT1 bond deal over Russia deal fears (FT)
Boeing warns of first-quarter cash burn after door plug blowout crisis (FT)
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