FTI Consulting News Bytes – 4 April 2025

FTI Consulting News Bytes

We kick off this week’s newsletter by examining Europe’s response to Trump’s latest round of tariffs, which saw Sweden’s prime minister urgently calling on Europe to make its capital markets more attractive for tech IPOs, or risk losing out to US markets. Elsewhere, we look at Elon Musk’s (re)purchase of X, before assessing the broader fallout of President Donald Trump’s protectionist policies and how the UK has responded. We end by looking at reports that British chip designer Alphawave could find itself at the centre of a bidding war before turning to TikTok, who faces a fast-approaching deadline to sell its US operations or face a ban in America. 

This week’s news

European tech companies need to stop IPO-ing in the US, says Sweden’s prime minister

In an interview with the Financial Times, Sweden’s prime minister, Ulf Kristersson, warned that Europe needs to make its capital markets more attractive for tech IPOs or risk tech firms all listing on US stock markets. The warning came after Sweden lost out on significant listings by a number of homegrown tech firms – with Spotify and Klarna both choosing New York over Stockholm. Kristersson stated that Europe had “a lot of homework to do,” adding that the draw for European tech companies to America is because “access to capital and the willingness to invest is much better.” Whilst Trump’s tariffs and attacks on European allies have pushed businesses to reconsider their US links, some tech executives pointed to the difference in valuations for European and US tech companies as a reason to still choose America. Kristersson proposed that Europe needs to implement a “plan for a capital markets union, designed to create a single market for investments on the continent.”

Elon Musk buys X… again

Elon Musk’s artificial intelligence firm xAI has acquired X, also owned by Musk, for $33 billion. Reuters noted that this move will allow the value of his AI firm to be shared with co-investors in X. Additionally, it is thought the deal will also help xAI to train its chatbot, Grok. Musk announced the acquisition in a post on X saying, “The combination values xAI at $80bn and X at $33bn ($45B less $12B debt).” He added “xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent.” An investor in xAI told media that the deal did not come as a surprise, adding that they viewed it as Musk “consolidating his leadership and management at his own companies.”

Trump’s tariffs trigger global shockwaves

Global markets have declined following Donald Trump’s tariff announcement, with British Prime Minister Kier Starmer acknowledging the negative impact on the UK economy. Trump imposed a 10% tariff on UK imports as part of broader trade levies affecting various countries. As reported by The Evening Standard, the FTSE 100 dropped 1.4% on opening, while Japan’s Nikkei 225 hit an 8-month low after facing a 24% tariff. In a meeting with UK business leaders, Starmer recognised the economic impact of the US measures both domestically and globally. He assured them that discussions for an “economic prosperity deal” would continue, emphasizing his commitment to securing the best deal for Britain.

British chip designer, Alphawave, at the centre of bidding war 

A London-based chip designer, Alphawave, has attracted a takeover approach from American rival Qualcomm, causing a surge in its stock price by nearly 47%, pushing its market value above £1 billion. According to Reuters, Qualcomm is considering a bid but has yet to make a formal offer, with a decision due by April 29. This development comes shortly after Arm Holdings, a Cambridge-based chip designer, also showed interest in Alphawave, raising the possibility of a bidding war. Alphawave designs chips that enhance data transmission and power efficiency, and its technology has become increasingly valuable as AI systems rely on vast networks of chips. The company, which has faced significant challenges since its 2021 listing, including short-selling activity and performance warnings, has seen its value drop by more than two-thirds. Despite this, the takeover interest offers a potential turnaround for the struggling firm.

Andreessen Horowitz in talks to help buy out TikTok

US venture capital firm Andreessen Horowitz is reportedly in talks to invest in TikTok as part of a bid led by Oracle and other American investors to buy out the platform’s Chinese investors, according to the Financial Times.  It was also reported that private equity firm Blackstone had taken an interest in the deal, but was only looking to make a small minority investment in TikTok’s US operations. Sources added that other large asset managers, who are not already invested in Bytedance, have been approached for investment. The news comes as the US government’s April 5 deadline looms, which stipulates that unless TikTok’s parent company ByteDance sells the US arm to non-Chinese entities, the app will be banned in the US.  

Top Tweets of the Week

• Kai Nicol-Schwarz, Senior Reporter at Sifted: DeepMind spinout Isomorphic Labs has raised $600m from OpenAI and Stripe-backer Thrive Capital, as it looks to advance its AI-designed drug candidates to clinical trials by the end of the year.
• Mark Gurman, Managing Editor at Bloomberg: Trump’s new massive tariffs on India, Vietnam, Malaysia, Thailand and elsewhere wipe out one of the reasons Apple diversified from China. Apple shares are plummeting and are now down 8% after hours. https://t.co/ZqWemMOf2d
• Endgadget: Amazon reportedly wants to buy TikTok now too. https://t.co/SJqAXZelGO
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Number of the week

$308m The amount AI video startup Runway has raised in a new funding round, led by private equity firm General Atlantic, to expand its new media ecosystem (Reuters).