KBW Ventures increases stake in US cellular seafood company

Prince Khaled bin Alwaleed bin Talal, KBW Ventures' founder and CEO, at the Milken Institute. (Supplied)
Prince Khaled bin Alwaleed bin Talal, KBW Ventures' founder and CEO, at the Milken Institute. (Supplied)
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Updated 20 January 2021

KBW Ventures increases stake in US cellular seafood company

Prince Khaled bin Alwaleed bin Talal, KBW Ventures' founder and CEO, at the Milken Institute. (Supplied)
  • BlueNalu produces a variety of seafood products directly from fish cells
  • KBW Ventures invests in companies with transformative technologies and business models

DUBAI: KBW Ventures, the company founded by Prince Khaled bin Alwaleed bin Talal Al-Saud, was among a group of backers who agreed to refinance $60 million of debt held by a Californian cellular agriculture seafood company, it was announced on Tuesday.

BlueNalu produces a variety of seafood products directly from fish cells. In addition to the latest debt financing, it previously raised $4.5 million in early 2018 and $20 million in 2020.

The San Diego company aims to use the funding to open a 40,000 square foot pilot production facility as part of its bid to launch a pilot program and eventually distribute its products across the US.

“The team at BlueNalu is driven to produce cell-based seafood products that are healthy for consumers, humane for animals, sustainable for our planet and provide increased food security to each nation in which we go to market,” said Lou Cooperhouse, BlueNalu president and CEO.

“This recent round of funding will allow us to continue advancing our mission and the next phase of our commercialization plans, while we continue to develop strategic partnerships that we expect will provide us with global market reach during the coming years.”

Prince Khaled bin Alwaleed bin Talal Al-Saud, founder and CEO of KBW Ventures, added: “We have increased our stake in BlueNalu by investing for the second time. Our commitment to inject further capital is based on the company’s impressive forward roadmap, detailing a clear path to ramping up production and bringing its first product to market. KBW Ventures is pleased to play a role in the largest financing ever for a cell-based seafood company, aligning ourselves with mission-driven businesses that seek to solve the world’s food security issues sustainably.”

Amir Feder, BlueNalu’s CFO, said the company is confident it can penetrate the lucrative $200 billion global seafood market and that it is in the process of signing up a series of international strategic partners.

Last month, KBW Ventures also increased its investment in a Singapore-based biotech company aiming to produce lab-grown dairy products. TurtleTree Labs raised $6.2 million as part of its latest round of funding. Besides KBW Ventures, other investors included Green Monday Ventures, Eat Beyond Global and Verso Capital.

Founded in 2019, TurtleTree Labs, which has offices in San Francisco and Singapore, will use the funds to accelerate research and production of functional, bioactive proteins and complex sugars found in human milk.

The company hopes these will have potential benefits in gut and brain health, which can be applied to both infant and senior nutrition and offer a viable alternative to animal-based dairy products.

KBW Ventures invests in companies with transformative technologies and business models. Its other investments include the Colorado-based pet food firm Bond Pet Foods and California’s Beyond Meat.


SoftBank says deal reached with WeWork founder, directors

SoftBank says deal reached with WeWork founder, directors
Updated 24 min 27 sec ago

SoftBank says deal reached with WeWork founder, directors

SoftBank says deal reached with WeWork founder, directors
TOKYO: SoftBank Group Corp. has reached a settlement in a US legal dispute with directors of office space-sharing venture WeWork Inc. and its founder Adam Neumann, the Japanese technology company said Saturday.
The terms of the settlement in the Delaware Court of Chancery were not disclosed. The statement said the agreement was not yet final. Other details were not immediately available.
The wrangling began more than a year ago after SoftBank acquired shares in WeWork, which was suffering after its failed IPO. But some investors and Neumann were not satisfied with the monetary deals offered by SoftBank.
“With this litigation behind us, we are fully focused on our mission to reimagine the workplace and continue to meet the growing demand for flexible space around the world,” said Marcelo Claure, executive chairman of WeWork and SoftBank Group International chief executive.
Tokyo-based SoftBank is a majority shareholder in WeWork, whose bumpy results, especially amid the coronavirus pandemic, has dented SoftBank’s financial results.
SoftBank says WeWork holds potential, especially in markets like Japan, where office space is costly and workers’ commutes tend to be long. SoftBank also invests in artificial intelligence, Internet services, sustainable energy and IoT.

Investors weigh new stock leadership as broader market wobbles

Investors weigh new stock leadership as broader market wobbles
Updated 19 min 3 sec ago

Investors weigh new stock leadership as broader market wobbles

Investors weigh new stock leadership as broader market wobbles
  • Tech and momentum stocks helped drive returns in 2020 “when everyone was locked down and all they had was their computer”

NEW YORK: A shakeup in stocks accelerated by the past week’s surge in Treasury yields has investors weighing how far a recent leadership rotation in the US equity market can run, and its implications for the broader S&P 500 index.
Moves this week further spurred a shift that has seen months-long outperformance for energy, financial and other shares expected to benefit from an economic recovery, while a climb in Treasury yields weighed on the technology stocks that have led markets higher for years.
The two-track market left the benchmark S&P 500 down for the week, and sparked questions about whether it could sustain gains going forward if the tech and growth stocks that account for the biggest weights in the index struggle.
So far this year, the S&P 500, which gives more influence to stocks with larger market values, is up 1.5 percent, while a version of the index that weights stocks equally is up 5 percent.
“That just tells us the gains are less narrow, more companies are participating, and I think that’s healthy,” said James Ragan, director of wealth management research at D.A. Davidson.
The focus on market leadership comes as investors are weighing whether the S&P 500 is due for a significant pullback after a 70 percent run since March, with the rise in long-dormant yields the latest sign of trouble for equities as it means bonds are more serious investment competition. The yield on the 10-year US Treasury note this week jumped to a one-year peak of 1.6 percent before pulling back.
Economic improvement will be in focus in the coming weeks, including the monthly US jobs report due next Friday, as will the country’s ability to ensure widespread coronavirus vaccinations, especially as new variants emerge.
Tech and momentum stocks helped drive returns in 2020 “when everyone was locked down and all they had was their computer,” said Jack Ablin, chief investment officer at Cresset Capital Management. “Now it seems with the vaccines, the stimulus and the prospect of reopening that we are looking out toward a recovery phase.”
The shift in the market this week is building on one that was fueled in early November, when Pfizer’s breakthrough COVID-19 vaccine news generated broad bets on an economic rebound in 2021.
Among the moves since that point: the S&P 500 financial and energy sectors are up 29 percent and 65 percent, respectively, against a nearly 9% rise for the benchmark index and 7 percent rise for the tech sector. The Russell 1000 value index has gained 16.5 percent against a 4.3 percent climb for its growth counterpart, while the smallcap Russell 2000 is up 34 percent.
“You definitely are seeing the reopening trade that has pretty much come alive here,” said Gary Bradshaw, portfolio manager of Hodges Capital Management.
Despite the gains, there remains “plenty of room for the reflation trade to run from a valuation perspective,” Lori Calvasina, head of US equity strategy at RBC Capital Markets, said in a report this week. RBC is “overweight” the financials, materials and energy sectors.
Rising rates tend to be favorable for more cyclical sectors, David Lefkowitz, head of Americas equities at UBS Global Wealth Management, said in a note, with financials, energy, industrials and materials showing the strongest positive correlations among sectors with 10-year Treasury yields.
Still, how long the market’s reopening trade lasts remains to be seen. Investors may be reluctant to stray from tech and growth stocks, especially with many of the companies expected to put up strong profits for years.
Any setbacks with the economy or with efforts to quell the coronavirus could revive the stay-at-home stocks that thrived for most of 2020.
And with a GameStop-fueled retail-trading frenzy taking hold this year, banks and other stocks in the reopening trade may fail to draw the same attention from amateur investors as stocks such as Tesla, said Rick Meckler, partner at Cherry Lane Investments.
“There isn’t the pizzazz to those stocks,” Meckler said. “There rarely is a potential for stocks to make the kind of moves that big tech growth stocks have made.”


IMF urges Tunisia to cut wage bill and energy subsidies

IMF urges Tunisia to cut wage bill and energy subsidies
Updated 27 February 2021

IMF urges Tunisia to cut wage bill and energy subsidies

IMF urges Tunisia to cut wage bill and energy subsidies
  • The IMF said in statement that monetary policy should focus on inflation by steering short term interest rates, while preserving exchange rate flexibility

TUNIS: The International Monetary Fund urged Tunisia on Friday to cut its wage bill and limit energy subsidies to reduce a fiscal deficit, putting more pressure on the fragile government amid a severe financial and political crisis.
With the coronavirus pandemic, political infighting and protests since last month over social inequality, it is a time of unprecedented economic hardship in the North Africa country that ran a fiscal deficit of 11.5 percent of GDP in 2020.
The IMF said in statement that monetary policy should focus on inflation by steering short term interest rates, while preserving exchange rate flexibility.
Tunisia’s 2021 budget forecasts borrowing needs $7.2 billion including about $5 billion in foreign loans. It puts debt repayments due this year at 16 billion dinars, up from 11 billion dinars in 2020.
The IMF said the service salary bill is about 17.6% of GDP, among the highest in the world.


House passes $1.9tn pandemic relief bill, sends it to Senate

House passes $1.9tn pandemic relief bill, sends it to Senate
Updated 20 min 7 sec ago

House passes $1.9tn pandemic relief bill, sends it to Senate

House passes $1.9tn pandemic relief bill, sends it to Senate
  • Final passage appeared likely after the measure cleared a procedural hurdle by a partyline vote of 219 to 210.

WASHINGTON: The House approved a $1.9 trillion pandemic relief bill early Saturday in a win for President Joe Biden, even as top Democrats tried assuring agitated progressives that they’d revive their derailed drive to boost the minimum wage.
The new president’s vision for flushing cash to individuals, businesses, states and cities battered by COVID-19 passed on a near party-line 219-212 vote. That ships the massive measure to the Senate, where Democrats seem bent on resuscitating their minimum wage push and fights could erupt over state aid and other issues.
Democrats said the still-faltering economy and the half-million American lives lost demanded quick, decisive action. GOP lawmakers, they said, were out of step with a public that polling shows largely views the bill favorably.
“I am a happy camper tonight,” Rep. Maxine Waters, D-Calif., said Friday. “This is what America needs. Republicans, you ought to be a part of this. But if you’re not, we’re going without you.”
Republicans said the bill was too expensive and said too few education dollars would be spent quickly to immediately reopen schools. They said it was laden with gifts to Democratic constituencies like labor unions and funneled money to Democratic-run states they suggested didn’t need it because their budgets had bounced back.
“To my colleagues who say this bill is bold, I say it’s bloated,” said House Minority Leader Kevin McCarthy, R-Calif. “To those who say it’s urgent, I say it’s unfocused. To those who say it’s popular, I say it is entirely partisan.”
That divide is making the fight a showdown over which party voters will reward for heaping more federal spending to combat the coronavirus and revive the economy atop the $4 trillion approved last year.
The battle is also emerging as an early test of Biden’s ability to hold together his party’s fragile congressional majorities — just 10 votes in the House and an evenly divided 50-50 Senate.
At the same time, Democrats were trying to figure out how to assuage progressives who lost their top priority in a jarring Senate setback Thursday.
That chamber’s nonpartisan parliamentarian, Elizabeth MacDonough, said Senate rules require that a federal minimum wage increase would have to be dropped from the COVID-19 bill, leaving the proposal on life support. The measure would gradually lift that minimum to $15 hourly by 2025, doubling the current $7.25 floor in effect since 2009.
Hoping to revive the effort in some form, Senate Majority Leader Chuck Schumer, D-N.Y., is considering adding a provision to the Senate version of the COVID-19 relief bill that would penalize large companies that don’t pay workers at least $15 an hour, said a senior Democratic aide who spoke on condition of anonymity to discuss internal conversations.
That was in line with ideas floated Thursday night by Sens. Bernie Sanders, I-Vermont, a chief sponsor of the $15 plan, and Senate Finance Committee Chair Ron Wyden, D-Oregon, to boost taxes on corporations that don’t hit certain minimum wage targets.
House Speaker Nancy Pelosi, D-Calif., offered encouragement, too, calling a minimum wage increase “a financial necessity for our families, a great stimulus for our economy and a moral imperative for our country.” She said the House would “absolutely” approve a final version of the relief bill because of its widespread benefits, even if it lacked progressives’ treasured goal.
While Democratic leaders were eager to signal to rank-and-file progressives and liberal voters that they would not yield on the minimum wage fight, their pathway was unclear because of GOP opposition and questions over whether they had enough Democratic support.
House Ways and Means Committee Chair Richard Neal, D-Mass., sidestepped a question on taxing companies that don’t boost pay, saying of Senate Democrats, “I hesitate to say anything until they decide on a strategy.”
Progressives were demanding that the Senate press ahead anyway on the minimum wage increase, even if it meant changing that chamber’s rules and eliminating the filibuster, a tactic that requires 60 votes for a bill to move forward.
“We’re going to have to reform the filibuster because we have to be able to deliver,” said Rep. Pramila Jayapal, D-Washington, a progressive leader.
Rep. Alexandria Ocasio-Cortez, D-N.Y., another high-profile progressive, also said Senate rules must be changed, telling reporters that when Democrats meet with their constituents, “We can’t tell them that this didn’t get done because of an unelected parliamentarian.”
Traditionalists of both parties — including Biden, who served as a senator for 36 years — have opposed eliminating filibusters because they protect parties’ interests when they are in the Senate minority. Biden said weeks ago that he didn’t expect the minimum wage increase to survive the Senate’s rules.
Pelosi, too, seemed to shy away from dismantling Senate procedures, saying, “We will seek a solution consistent with Senate rules, and we will do so soon.”
The House COVID-19 bill includes the minimum wage increase, so the real battle over its fate will occur when the Senate debates its version over the next two weeks.
The overall relief bill would provide $1,400 payments to individuals, extend emergency unemployment benefits through August and increase tax credits for children and federal subsidies for health insurance.
It also provides billions for schools and colleges, state and local governments, COVID-19 vaccines and testing, renters, food producers and struggling industries like airlines, restaurants, bars and concert venues.
Democrats are pushing the relief measure through Congress under special rules that will let them avoid a Senate GOP filibuster, meaning that if they are united they won’t need any Republican votes.
It also lets the bill move faster, a top priority for Democrats who want the bill on Biden’s desk before the most recent emergency jobless benefits end on March 14.
But those same Senate rules prohibit provisions with only an “incidental” impact on the federal budget because they are chiefly driven by other policy purposes. MacDonough decided that the minimum wage provision failed that test.
Republicans oppose the $15 minimum wage target as an expense that would hurt businesses and cost jobs.

Related


BA owner calls for COVID health passes after record $9 billion loss

BA owner calls for COVID health passes after record $9 billion loss
In this Tuesday, Jan. 10, 2017, file photo, British Airways planes are parked at Heathrow Airport in London. (AP)
Updated 27 February 2021

BA owner calls for COVID health passes after record $9 billion loss

BA owner calls for COVID health passes after record $9 billion loss
  • Tighter travel restrictions have threatened to ruin Europe's critical summer season

LONDON: British Airways owner IAG is counting on digital health passes to help spur a travel recovery this summer, after the pandemic pushed it to a record €7.4 billion ($9 billion) loss last year, when it ran just a third of normal flights.

Tighter travel restrictions over the last two months have threatened to ruin Europe’s critical summer season and leave some airlines needing more funding, analysts have warned.
But after taking on new loans, IAG said it had €10.3 billion of liquidity and was well set to ride out the crisis.
“We’ve got very strong liquidity going into 2021 ... so no, we will not need additional funding,” finance chief Steve Gunning told reporters on a call.
European airlines hope travel restrictions will soon be eased to allow them to make money again. Britain on Monday laid out plans for travel markets to possibly reopen from mid-May, prompting a flood of bookings.
IAG chief executive Luis Gallego said if the UK plans went ahead, it would be a “positive summer,” but digital health passes were needed to unlock the market.
“Health passes are going to be the key to restart the aviation and the travel,” said Gallego, who is six months into the job, calling for a digital system that could include test results and proof of vaccination.
Several countries are considering health passports to help revive travel, but are worried about risks to civil liberties. However, Britain’s Heathrow Airport warned this week that dealing with a big rise in passengers would not be possible with current paper-based checks.
IAG shares were up 4 percent at 194 pence in morning trading. They have jumped 13 percent in the last five days, after Britain’s announcement on a travel restart, but over the last 12 months have lost half their value.

Cash burn
The pandemic has already crippled airlines like Norwegian Air, and left major players such as Air France-KLM and Lufthansa relying on state support.
While a recovery is now in sight, there is still much uncertainty.
IAG, which also owns Aer Lingus, Iberia and Vueling, said it could not give profit guidance for 2021, and asked how many flights it might run this year, Gallego said: “To be honest nobody knows what’s going to happen.”
For January-March, IAG said it expected to fly about 20 percent of 2019’s capacity, compared to the whole of 2020 when it flew at 34 percent of capacity.
IAG’s focus for now is on cutting costs to reduce cash burn. Weekly cash burn fell to €185 million in the first quarter, down 30 million from the previous quarter.
Last October, IAG secured shareholder backing for a €2.74 billion capital hike and Goodbody analysts said it might have to call on investors again.
“With further losses expected this year ... another rights issue can’t be ruled out in the medium term,” they said.
IAG’s operating loss before exceptional items, its preferred measure, came in at €4.37 billion, slightly better than analysts’ consensus forecast for a 4.45 billion loss.