“Serious Concerns” on the PGA Tour
Just days before Tuesday’s PGA Tour hearing before the Senate Permanent Subcommittee on Investigations, senior Tour board member Randall Stephenson has resigned. His reason? He said he could not support the golf organization’s proposed partnership that includes LIV Golf, its Saudi-backed rival, DealBook’s Lauren Hirsch and The Times’ Alan Blinder report.
In a scathing resignation letter obtained by DealBook, Mr. Stephenson, the former AT&T chairman, said he — like most members of the board — was left out of the loop as the round negotiated a deal with Saudi Arabia’s sovereign wealth fund that rocked the sport. world.
I have serious concerns With how this framework agreement has come to fruition without the oversight of the board,” Mr. Stevenson wrote, adding that he could not “evaluate it objectively or, in good conscience,” “particularly in light of the US intelligence report on Jamal Khashoggi in 2018.”
Mr. Stephenson was already planning to retire from the board of directors, two people familiar with his thinking told DealBook. (In fact, he has recently been in the habit of attending most board meetings via videoconference, with the exception of one last month in Michigan.)
The Saudi deal accelerated the timeline. Days after the deal was announced, the chairman, Ed Herlihy, told law firm partner Wachtell, Lipton, Rosen & Katz, of his plan to resign. Herlihy asked Mr. Stevenson to hold out while Guy Monahan, the PGA Tour commissioner, was on medical leave. Mr. Monahan announced his return on Friday. Stevenson’s resignation letter was dated Saturday.
The council wants to consider alternatives. “It is my hope that, as this Board moves forward, it will comprehensively rethink its governance model and keep its options open to assess alternative sources of capital beyond the current framework agreement,” Mr. Stephenson wrote.
There are other investors interested, DealBook heard. But it is not clear how they can compete with the Saudi wealth fund. The Saudi coalition is the only one that can end the litigation between the two sides.
The optics look bad for the PGA Tour. At Tuesday’s Senate hearing, Jimmy Dunn, a PGA Tour board member who was heavily involved in the negotiations, is scheduled to testify alongside the tour’s chief operating officer, Ron Price. Mr Stephenson’s exit also raises more questions about the deal itself, which still needs to be approved by the tour’s 10-member, five-player board.
Here’s what happens
Threads has surpassed 100 million users, which is a record number of app downloads. The new Meta social network has reached this level in Just a few days, much faster than the two months that ChatGPT needed to reach this milestone, according to The Verge. while, traffic to his social network It appears to have declined sharply over the same period.
Carl Icahn negotiates breathing room with his banks. Under pressure from a short seller over loans tied to his publicly traded investment vehicle, Icahn Enterprises, the billionaire reached a compromise with some lenders that decoupled some of that borrowing from the company’s stock price, Wall Street Journal reports. That could help relieve pressure on the company’s declining stock.
The emperors are set to arrive at Sun Valley. Allen & Company’s annual conference of technology and media CEOs is set to kick off in Idaho on Tuesday, with leaders like Apple’s Tim Cook, Meta’s Mark Zuckerberg and Warner Bros.’s David Zaslav. Discovery in the guest list. The pool is famous as where the big deals are born – think Comcast buying NBCUniversal or Jeff Bezos’ acquisition of The Washington Post -.
Musk puts Wachtell in the spotlight
Elon Musk has made good on his threat to take revenge on those who forced him to buy Twitter. The social network’s parent company on Friday sued Wachtell, Lipton, Rosen & Katz, the Wall Street law firm that represented Twitter’s former board in an effort to get the billionaire to complete the $44 billion takeover bid.
Twitter accused Wachtell, who has long been among Wall Street’s most respected And profitable Companies “unjust enrichment” by negotiating exorbitant success fees just before the deal is done. Some legal experts said the lawsuit faces long odds because Twitter’s board approved Wachtell’s fee — but it also raises the question of whether the company’s high-powered advice is worth its price tag.
It’s the first time Twitter has done this Refund seller fee, After months of clamping down on consultants and landlords alike over unpaid bills. By any measure, Wachtel’s bill was high: “Oh my God that breaks,” Martha Lane Fox, a board member at the time, wrote in an email upon seeing the cost.
According to the lawsuit, Twitter executives transferred $84 million to Wachtell just 10 minutes before Mr. Musk fired them at the closing of the acquisition. That was fortunate for Wachtell: Other advisors on the deal, including public relations firm Joele Frank and Wilkinson Brimmer Katcher and shareholder relations firm Innisfree M&A, have also sued Twitter for unpaid fees.
Wachtell provided value to Twitter shareholders at the time. It helped the board of directors force Mr. Musk to complete the takeover offer, even if it was The company’s business deteriorated During months of uncertainty over whether the deal would close. Wachtell also helped Twitter avoid a trial, which would have cost more in paid hours.
But the lawsuit sheds light on Wachtell’s billing practices. On June 27, 2022, according to the complaint, one of Wachtell’s attorneys billed $1,625 for five hours of crafting stock price reactions. On July 9, he charged an attorney $3,006.25 for 9.25 hours of small assignments and staying on public standby.
Wachtell’s bills have been checked by: Carl Icahn to no avail File a lawsuit against the company For her advice in defending CVR Energy against a takeover bid.
(DealBook wonders: What has Mr. Musk’s legal advisor, Skadden, been accused of?)
What comes next: It’s possible the parties will head to arbitration, but the lawsuit raises the possibility that Mr. Musk could eventually sue Twitter’s former board of directors for breach of a fiduciary duty, having accused the directors of doing so by agreeing to pay Wachtell.
Remember, Mr. Musk fired the previous management of the company for a reason, depriving them of the golden parachutes, but he never specified the reason. Maybe argue that this is?
Appreciation of Janet Yellen’s trip to China
Janet Yellen’s trip to China received largely positive headlines, despite no and some political breakthroughs colic On the Diplomatic Protocol of the Secretary of the Treasury. Yelin said the relations were on a “steady basis” and the official Chinese news agency described the talks as constructive.
But for anyone to consider the mere fact that the world’s two largest economies are talking about success shows just how bad relations have become (or an indication of how desperate Beijing is to calm tensions amid a growing domestic slowdown).
The focus was on building relationships. Ms. Yellen met with officials recently assigned economic policy, many of whom have little international experience and about whom few Western policymakers know. She spoke of “diversified” supply chains – also an alleged Chinese goal – and avoided any mention of “segregation” or “cynicism”.
“Chinese decision-makers understand that she is more moderate compared to many other senior officials in Washington when it comes to China policy,” Li Minjiang, an expert on China’s foreign policy at Nanyang Technological University in Singapore, told DealBook. In particular, Beijing likes its public assertion that decoupling would be disastrous for both countries.
But the pressure points have not been resolved. No new policies have been announced and the retaliation continues: China said it would restrict exports of minerals essential to its chip industry and Ms. Yellen criticized Beijing’s treatment of US companies.
China has big problems at home. Official data published on Monday shows that the country is teetering on on the brink of recession, as consumer spending slows and weak global economic growth hits exports. It is the latest sign that China’s post-Covid recovery has not materialised, leading to renewed calls for new stimulus measures.
What then: John Kerry, President Biden’s climate envoy, will travel to China this month to resume talks on global warming.
A rare set of defections at a major Wall Street public relations firm
Speaking of Joel Frank, the Wilkinson Premier Catcher… The company, best known for its behind-the-scenes advice on deals and corporate crises, has made headlines of its own: several executives — along with Ed Hammond, star M. & A. reporter Bloomberg — We’ve created Collected Strategies, a new public relations firm.
The DealBook phone lit up on Sunday night after word got out because it was the first time in two decades of Joel Frank’s rule that a partner had left to found a rival.
Joele Frank is one of the largest PR firms on Wall Street. Founded in 2000 by Ms. Frank, it has become a go-to for companies looking to make – or oppose – deals, and to advocate for themselves. against activist investors Or find their way through the crisis. (Her clients over the years have included GE, Sony, Time Warner, and US Airways.)
Mrs. Frank also distributed the shares widely among her partners, who were well paid. This is why Joele Frank hasn’t followed competitors like Sard Verbinnen into selling himself, and why no partner has jumped in to set up a competing company–yet.
Includes departing partners Scott Besang, who advised Twitter on its deal with Elon Musk, and Jim Golden, who advised First Republic and PacWest.
Difficult to create a new company, Given the years it took to build relationships with corporate leaders, M. & A. bankers, and lawyers. Often, as in other industries, executives are also required to take long leaves between jobs.
In this case, the founders of Collected cannot go after their former customers for some time, since they have involuntary agreements.
But it’s boom time for the new consulting shops anyway, It was formed by veterans of old companies such as Brunswick and Sard Verbinnen (now part of FGS Global, after a series of mergers).
Among the PR firms that have sprung up over the past decade are Gladstone Place Partners, C Street Consulting Group, Gastalter & Company, and Revmark.
Next week << Keep this as H2 for the NL
Corporate earnings, geopolitics and inflation will loom large this week. Here’s what to watch:
Tuesday: NATO’s annual summit begins with a focus on Ukraine’s entry into the alliance.
Wednesday: CPI is prepared for release. Economists polled by Bloomberg had expected headline inflation to ease in June to 3.1% year-on-year, the smallest increase since March 2021.
Thursday: Earnings season kicks off with PepsiCo and Delta Air Lines reporting results. Investors are worried About corporate profitability, given inflation and high interest rates.
Friday: It’s Wall Street’s turn, as BlackRock, Citigroup, JPMorgan Chase and Wells Fargo prepare to report.
Commodities giant Glencore might consider it Spinning from the coal section which was for a long time one of her most successful works. (foot)
It is reported that the Saudi National Bank introduced to Increase its stake in Credit Suisse to 40 percent before the Swiss bank collapsed, but was rejected by the Swiss financial regulator. (bloomberg)
The best of the rest
Comedian Sarah Silverman and two authors Lawsuit against OpenAI and Meta accused of copyright infringement, accusing the companies of programming their own artificial intelligence networks using their work without payment. (the edge)
America wrapped Miles of toxic lead cables(Wall Street Journal)
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