Axios Pro Rata: Elon dumps $8B

Plus: His Twitter ideas | Friday, April 29, 2022

Open in app View in browser   Presented By Latham & Watkins   Axios Pro Rata By Kia Kokalitcheva · Apr 29, 2022 Happy Friday — hope you're all as excited for the weekend as I am!     Top of the Morning Illustration: Eniola Odetunde/Axios   Given a string of deal news landing over the last 24 hours, let's do a lightning round before we head out for the weekend: Elon's Twitter: According to Reuters, Elon Musk floated potential plans to cut headcount and other costs post-acquisition during deal discussions with bankers. This isn't in the least bit surprising since he'll need to generate profits to repay the debt he's using for the purchase. (Though it's also counter to his previous comments about not caring about the company's economics.) Musk has also reportedly lined up a new CEO replacement, though it's unknown who that person is. And he's also floated ideas to gin up more revenue for the company, like additional ways to monetize tweets, and cutting board director pay. Yes, but: Most of these are visions and ideas — we'll have to see what he actually does post-close. China's pause on the pause: As the new wave of COVID hits the country's economy, regulators are pulling back on the growing clamp down on tech companies, according to WSJ. Specifically, regulators are reportedly considering pausing their planned limits on how much time young people can spend on mobile apps. "Any loosening of regulations for the tech sector would underscore the importance of economic stability for Chinese leader Xi Jinping in a key political year in which he is expected to break with recent precedent and seek a third term in power," writes WJS's Keith Zhai. Yes, but: The government is nevertheless said to remain committed to eventually rolling out all its new internet regulations. It's also reportedly considering forcing its big tech companies like Tencent and Meituan to give the state both equity stakes of 1% and direct roles in corporate decisions. Activision's Blizzard: Yesterday, 98% of the gaming company's shareholders voted to approve its sale to Microsoft for $69 billion. Yes, but: The vote is non-binding and advisory, though a necessary step in the process. And the deal still needs to clear regulatory huddles. Arm China resolution: The chip giant's Chinese arm has finally resolved its bizarre dispute with former CEO Allen Wu, the company said Friday morning. With Wu officially out, it's appointed two co-CEOs. "Arm China has resolved its longstanding corporate governance issue as its Board of Directors has voted unanimously to appoint Liu Renchen and Eric Chen as Arm China's co-CEOs," the company said in a statement. Flashback: Arm's board voted in 2020 to oust Wu as CEO, but challenged the move multiple time in court and remained in possession of the company's "chop" — a seal required by Chinese law to officially authorize company documents — and cut off communication from its U.K. parent.     The BFD Illustration: Brendan Lynch/Axios   Elon Musk has sold about $8.4 billion worth of Tesla shares (about 9.6 million) between Tuesday and Thursday, according to new regulatory filings. Why it's the BFD: With Musk's bid to acquire Twitter accepted by the board on Monday, and no known equity partner so far, it's been clear that he'd have to sell some assets to finance the non-debt portion of the deal. Now we're seeing a first piece of how he's assembling the cash. Details: Until these sales, Musk owned about 17% of Tesla. On Thursday evening, he also tweeted (of course) that he would not sell any more stock in the electric vehicle company (where remains CEO). The bottom line: "He did not say how long he would hold off selling any more Tesla stock, or whether his plans would change in the future, leaving open the question of whether or when he would return to the market to raise more money. " — Richard Waters, FT     Venture Capital Deals 🚙 Divergent Technologies, a Los Angeles-based startup 3D printing car parts, raised $160m in Series C funding from Tom Steyer, John Thornton, and others. http://axios.link/Riar . • Ayar Labs, an Emeryville, Calif.-based optical connectivity company, raised $130m in funding led by Boardman Bay Capital Management, with Hewlett Packard Enterprise, Nvidia, Applied Ventures, Intel Capital, and Lockheed Martin Ventures. http://axios.link/GzIN • Inventa, a Brazil-based wholesale marketplace for shopkeepers, raised $55m in Series B funding led by Greylock, with Greenoaks, Andreessen Horowitz, Monashees, Founders Fund, Tiger Global, and others also participating. http://axios.link/K5IE 🚑 Kelonia Therapeutics, a Cambridge, Mass.-based biotech company, raised $50m in Series A funding from Alta Partners, Horizons Ventures, Venrock, and others. http://axios.link/eu8j • Vanilla, a Los Angeles-based estate and wealth management platform, raised $30m in Series B funding round led by Insight Partners. www.justvanilla.com • Sealed, a New York-based home weatherization and electrification company, raised $29.5m from Robert Downey Jr.'s FootPrint Coalition, Fifth Wall, CityRock, Cyrus, and KeyFrame Capital, among others. http://axios.link/FtXn • Exafunction, a San Francisco-based machine learning infrastructure startup, raised $25m in Series A funding led by Greenoaks, with Founders Fund also participating. http://axios.link/qMwX • Kard, a New York-based card API startup, raised $23m in Series A funding led by Tiger Global, with Fin Capital, s12f, Underscore VC, and angel investors also participating. www.getkard.com • Doppler, a San Francisco-based data encryption and management platform, raised $20m in Series A funding led by CRV, with GV, Sequoia Capital, and Y Combinator also participating. http://axios.link/4mJC • Hour One, a New York and Tel Aviv-based AI video generation company, raised $20m in Series A funding led by Insight Partners. http://axios.link/WRSs • Synthesis AI, a San Francisco-based AI modeling startup, raised $17m in Series A funding led by 468 Capital, with Sorenson Ventures, Strawberry Creek Ventures, Bee Partners, PJC, iRobot Boom Capital and Kubera Venture Capital also participating. www.synthesis.ai • Bounce, a San Francisco-based short-term storage startup, raised $12m in Series A funding led by Andreessen Horowitz. http://axios.link/S44p • Radius, a San Francisco-based online real estate brokerage startup, raised $13m in Series A funding led by Crosscut Ventures and NFX. www.radiusagent.com • Glorang, a South Korea-based edtech startup, raised $10m in Series A funding led by Korea Investment Partners and Murex Partners, with Pksha Capital also participating. http://axios.link/HBSR • Lucid Green, a New York-based cannabis supply chain platform, raised $10m in Series B funding led by Gron Ventures, with Gotham Green Partners also participating. www.lucidgreen.io ⛽️ Advanced Ionics, a Milwaukee-based maker of hydrogen electrolyzers, raised $4.2m in new funding led by Clean Energy Ventures, with SWAN Impact Network also participating. www.advanced-ionics.com • Cartwheel, a Los Angeles-based delivery management platform for restaurants and retailers, raised $3m in seed funding led by Moonshots Capital, with Chingona Ventures, TenOneTen Ventures, Act One, and Pitbull Capital also participating. http://axios.link/4q2K • Taelor, a San Francisco-based menswear rental subscription service, raised $2.3m in pre-seed funding led by Bling Capital. http://axios.link/zbAc • Securonix, an Addison, Texas-based cybersecurity company, raised additional funding from Capital One Ventures, Snowflake Ventures, Verizon Ventures, and Wipro Ventures as part of a previous round of more than $1b in capital. www.securonix.com     A message from Latham & Watkins What happens after a cyberattack?     Governments and customers increasingly expect and demand robust privacy protections against ever-more sophisticated methods of attack — and disclosures when they happen. Follow the Global Privacy & Security Compliance Blog from Latham & Watkins for the latest developments.     Private Equity Deals 🚑 Xpress Wellness, backed by Latticework Capital Management, acquired Integrity Urgent Care, a Bryan, Texas-based chain of urgent care clinics in rural Texas. www.integrityuc.com     Public Offerings 🚑 Belite Bio, a San Diego-based Phase 3 biotech company developing an oral therapy for retinal degeneration diseases, raised $36 million by offering 6 million American depositary shares (ADS) at $6, the midpoint of the range of $5.50 to $6.50. Parent Lin BioScience agreed to purchase $15 million worth of ADSs. It plans to list on the Nasdaq under the symbol BLTE. The Benchmark Company acted as sole bookrunner on the deal. http://axios.link/fVmn 🚑 HilleVax, a Boston-based Phase 2 biotech company developing a novel norovirus vaccine in-licensed from Takeda, raised $200 million by offering 11.8 million shares at $17. It plans to list on the Nasdaq under the symbol HLVX. J.P. Morgan, SVB Leerink, Stifel, and Guggenheim Securities acted as joint bookrunners on the deal. http://axios.link/q33W 🚑 Bausch + Lomb, a Canada-based supplier of contact lenses and eyecare products, plans to raise $788 million by offering 35 million shares (100% secondary) at a price range of $21 to $24. At the midpoint of the proposed range, Bausch + Lomb would command a fully diluted market value of $8.2 billion. It plans to list on the NYSE under the symbol BLCO and list on the Toronto Stock Exchange too. Morgan Stanley, Goldman Sachs, Citi, J.P. Morgan, Barclays, BofA Securities, Guggenheim Securities, Jefferies, Evercore ISI, Wells Fargo Securities, and Deutsche Bank are the joint bookrunners on the deal. http://axios.link/7HV3     SPAC Stuff • Space Acquisition I, a blank check company targeting space-related businesses, withdrew its plans for an IPO. http://axios.link/WD6h • Hudson Acquisition I, a blank check company targeting U.S. tech companies, filed to raise up to $60 million in an IPO. http://axios.link/K2oI     Liquidity Events • Helen of Troy agreed to acquire Recipe Products, a U.K.-based maker of hair care brand Curlsmith and backed by BFG Partners, for $150m. http://axios.link/MjAb     More M&A • HackerOne acquired PullRequest, an Austin-based code review startup. http://axios.link/mhGm 🚑 Somatus acquired Lumiata, a San Mateo, Calif.-based healthcare analytics startup. www.lumiata.com     Fundraising • January Ventures has raised $21m for its second VC fund. http://axios.link/y0xN • Union Square Ventures has raised $275m for a new core VC fund and $350m for an opportunity fund. www.usv.com • Flare Capital Partners has raised $350m for a fund focused on healthcare technology companies. www.flarecapital.com • Cardinal Sports Capital and Hot Paper Lantern Digital Sport are teaming up to invest up to $100 million into sports tech startups. http://axios.link/xAtV     It's Personnel • Bradley Belt has joined MidOcean Partners as an operating partner on its private equity executive board. He was previously vice chairman of Orchard Global Asset Management. www.midoceanpartners.com     Final Numbers Data: SEC filing; Chart: Erin Davis/Axios Visuals     A message from Latham & Watkins Are you a "dealer" according to the SEC? We'll explain     Financial services companies large to small, from fintech startups to Wall Street titans, face an ever-changing regulatory environment around the globe. Stay on top of the latest developments by bookmarking Latham & Watkins' Global Financial Regulatory Blog.   🙏 Thanks for reading Axios Pro Rata! Please ask your friends, colleagues and Tesla shareholders to sign up. Go deeper with Axios Pro: Deals, featuring hyper-relevant news and analysis across PE, VC and M&A.   Axios thanks our partners for supporting our newsletters. If you're interested in advertising, learn more here. Sponsorship has no influence on editorial content. 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