FTI Consulting News Bytes – 12 July 2024

FTI Consulting News Bytes

It’s been another outstanding week in the world of tech and crowned by England’s Euros semi-final success it may well turn out to be an unforgettable one. We start in Hollywood and with Paramount Global who has agreed to merge with independent film studio house Skydance Media in a multi-billion-dollar deal. Next up former UK Prime Minister Tony Blair has been calling for AI to be deployed to revive the public sector. Elsewhere, Apple has agreed to open its tap-and-go mobile payments system to rivals following a four-year dispute with the EU’s antitrust regulator. Next up is Shein’s eagerly anticipated IPO as they launch a €200m circularity fund to address sustainability concerns. Finally, we look at Chinese VC firm, HongShan’s record breaking fundraising round following its breakup from the US. 

On that note, let’s bring it home!

This week’s news

Hollywood studio Paramount agrees $28bn merger with Skydance 

Paramount Global, one of Hollywood’s best-known companies, has agreed to merge with independent film studio Skydance in a deal which values Paramount at $28bn (£22bn). The deal ends more than six months of negotiations, as reported by The Guardian. It also marks the end of ties between Paramount and the Redstone family, 30 years after Sumner Redstone’s Viacom acquired Paramount Pictures in a deal worth $10bn. The article added that Skydance owner, David Ellison will take over from Shari Redstone, with the aim of transforming Paramount into a ‘media and tech’ company. Ellison told the Financial Times that “in order to effectively navigate this transition, what is required for Paramount as a pure-play media company is to transition [into] a media and technology company.”

Tony Blair calls for Labour government to deploy AI to revive public services 

The Telegraph writes, as part of the Tony Blair Institute for Global Change conference (TBI) this week, former UK Prime Minister Tony Blair voiced his belief that AI can transform the UK’s public services. He stated that AI can save the public sector time and money, cut headcounts, and optimise operations, thereby securing high-productivity growth. In remarks to attendees, he emphasised “the greatest risk is not being too bold, but too timid”. The article added that although public sector IT projects like the NHS digitisation project had not worked, Blair warned that growth and productivity were at risk if the UK did not harness AI more. 

Apple ends four-year dispute with EU regulators on tap-and-go payment

Reuters reports that EU antitrust regulators and Apple have agreed to settle disputes regarding competitor use of its tap-and-go payment system, ending a four-year long investigation and the threat of hefty fines for Apple. The move marks a change in strategy by Apple, which previously pushed back against the EU competition watchdog’s scrutiny of its business practices. Apple confirmed their offer would give European developers an option to access the near-field communication technology (NFC) it uses in its contactless payments to pre-build payment apps for rival mobile wallet providers. In response to the announcement, EU antitrust chief, Margrethe Vestager, stated “From now on, competitors will be able to effectively compete with Apple Pay for mobile payments with the iPhone in shops. So consumers will have a wider range of safe and innovative mobile wallets to choose from.” 

Shein launches €200m fund to tackle fashion waste and sustainability concerns 

Shein is launching a €200 million “circularity fund” aimed at addressing fashion waste, in response to ongoing concerns about the brand’s sustainability efforts, the Financial Times reports. Amid ongoing speculation around a UK floatation, Shein chairman Donald Tang highlighted they intend to inject the cash into start-ups and more established businesses in the UK and Europe “as soon as possible.” The FT article added potential investments could include investing in early-stage companies focused on recycled materials and more mature companies utilising sustainable innovative fabrics. Tang emphasised that the fund was not merely a reaction to criticism of Shein’s supply chain but a “continuation of the efforts and journey that we have been on for quite some time.”

Sequoia Capital’s former China unit raises new $2.5bn start-up fund

In the largest fundraising round by a privately owned venture capital firm in China, HongShan has raised $2.5bn. The company which split off from US venture capital firm Sequoia Capital last year over geopolitical issues, defied a funding freeze which hit industry rivals and hopes to use new funding to further investment in technology start-ups across China. The Financial Times article noted the fund is smaller than HongShan’s $9bn fund raised in 2022, which it has so far struggled to deploy. HongShan founder Neil Shen, who is widely considered the country’s most powerful tech investor, secured backing from the Hangzhou city government and several private and state-owned insurance companies.  

Top Tweets of the Week

• CityAM: British firms have received nearly a third of European venture capital tech funding so far this year, new data shows, as investors flock back to London and Cambridge bolsters its credentials as an international hub.  
• Tom Warren, Senior Editor, The Verge: Microsoft and Apple are both ditching their OpenAI board seats amid regulatory scrutiny. Regulators in the EU, UK, and US are all looking closely at Big Tech AI deals, and now OpenAI is switching to stakeholder meetings instead of board seats.  
• Department for Science, Innovation and Technology: “We’ll take the world-class scientific community we have here and be the partner they need to get to the next level.” @peterkyle sets out his priorities to maximise the UK’s potential in science and tech to grow the economy, transform public services and improve people’s lives. 

Number of the Week

1000– The amount of jobs Dyson plans to cut across their UK workforce. (Reuters)