Issue #35

PwC partner salaries fall to £862,000, FTX co-founder forfeits $11 billion, Japan faces sushi crisis, and more.

News from September 19 - September 26, 2024

BNP Paribas Readies for €5.1 Billion Acquisition

BNP Paribas is in exclusive talks with Axa to acquire its investment management arm for €5.1bn, which would create a firm managing €1.5tn in assets. Despite this deal, Amundi will remain the largest European pure-play investment manager with €2.2tn under management.

Jean-Laurent Bonnafé, BNP CEO, said this acquisition will help serve clients like insurers and pension funds better. Axa's CEO, on the other hand, explained the sale is part of a strategy to streamline operations and focus on its core insurance business. 

BNP is using funds from its prior Bank of the West sale to fuel this expansion which it sold for $16.3bn in 2021. 

Source

PwC Partner Salaries Fall to £862,000 

PwC UK’s partners saw their average earnings drop to £862,000 this year, down 5%, as sales growth slowed and rising costs cut into profits. While total revenues increased by 9% to £6.3bn, profits fell 14% to £1.1bn due to higher staff costs. 

The Middle East branch performed well with a 26% sales boost, but the UK’s economic slowdown limited growth to 3%. 

Consulting, driven by Middle Eastern infrastructure projects, was the standout division, growing 18%, with tax and audit services also remaining resilient despite challenging market conditions.

‍Source

Nike Gets New CEO 

Elliott Hill, who spent 32 years at Nike leading the Nike and Jordan brands, will return as CEO on October 14 with an annual salary of $1.5 million. He steps into a company that has changed significantly and faces mounting pressure from rising competition. 

While Nike hit $50 billion in sales in 2023, growth has slowed, and sales are expected to drop by 2025. Brands like Roger Federer-backed On and Adidas are gaining ground. 

To adapt, Nike is simplifying its product lineup, automating processes, and cutting jobs in an attempt to save $2 billion over the next three years.

Source 

Bulletin Board

• FTX Co-Founder Forfeits $11 Billion. Caroline Ellison, former CEO of Alameda Research and key witness against FTX founder Sam Bankman-Fried, was sentenced to two years in prison and ordered to forfeit $11 billion for her role in the FTX fraud. While prosecutors praised her cooperation in convicting Bankman-Fried, the judge emphasized the need to deter others from similar crimes, rejecting requests for a no-prison sentence. Ellison, visibly emotional, expressed deep regret for not leaving FTX earlier. She remains free on bail until November. Bankman-Fried received 25 years in prison, while two other FTX executives await sentencing later this year. Source
• London’s AIM In Danger. The London Stock Exchange's AIM market could face significant disruption if tax breaks are removed in the upcoming budget. Removing business relief is expected to lead to a 20-30% drop in stock value and a withdrawal of 15% of its capital, according to warnings from LSE chief Dame Julia Hoggett. She highlighted the potential impact on smaller businesses, with over 410,000 jobs and £35.7 billion in UK GDP at stake. Hoggett expressed concerns that removing these tax incentives could limit access to funding for growth companies and weaken the market's overall stability. Source  
• US Proposes Chinese Software Ban. The US Commerce Department has proposed banning Chinese software and hardware in internet-connected vehicles, effectively blocking Chinese cars from the US market. The move aims to prevent potential data collection and manipulation by foreign adversaries. Part of a broader effort to curb Chinese imports, the ban also targets Russian technology. While exceptions may be allowed with strict measures, officials expect the ban to cover most Chinese vehicles, with software restrictions starting in 2027 and hardware bans by 2030.  Source
• Gez Z Takes Over Tech. The "curse of 35" is becoming a growing concern in the tech industry, where workers over that age face diminishing career opportunities. While younger employees, especially those under 25, are thriving, older workers are seeing fewer roles and experiencing more layoffs. A recent report highlights that tech companies increasingly favor youth, with age discrimination complaints making up 20% of cases in the industry. Despite the value of experience, workers over 35 often struggle to stay relevant in a sector that prioritizes speed, innovation, and a youthful "culture fit." Source
• Japan Faces Sushi Crisis. Japan is facing its biggest rice shortage in decades, impacting popular dishes like sushi, onigiri, and yakitori don. The shortfall is due to a mix of bad weather, aging rice farmers, and an influx of tourists driving up demand. Supermarkets have reported empty shelves and rationed rice sales, while rice prices surged 5% this year. Japan’s rice policies, including a 778% tariff on imports, further limit supply. Despite tourist consumption doubling, it remains small compared to domestic demand, which continues to outpace production, causing the lowest rice stocks in over 20 years.  Source

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