Markets Defused gives an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.
- Deliveroo ‘in play’ after DoorDash takeover approach
- Rivian’s $5bn VW deal is a “game changer”
- Universal London park would boost UK economy by $50bn
- Grindr lays out AI plan to launch new services and grow revenue
Deliveroo ‘in play’ after DoorDash takeover approach
Deliveroo PLC (LSE:ROO) shares were slightly higher at Wednesday’s close, up 1.18% at 129p each, after reports of talks with American food delivery peer DoorDash Inc (NYSE:DASH) over a potential takeover.
DoorDash approached Deliveroo last month, according to a Reuters report.
However, talks ended with no agreement, and valuations were mismatched.
At just under 130p, the market is currently valuing Deliveroo at around £2.1 billion.
Analyst views on the news suggest it may only be the beginning of potential bids for Deliveroo and that other bidders could potentially emerge.
The London-listed shares, which are 13.2% owned by Amazon, have struggled since what now looks like a disappointing IPO. It is down 54% since the 2021 float.
Rivian’s $5bn VW deal is a “game changer”
Rivian Automotive Inc (NASDAQ:RIVN) $5 billion deal with Volkswagen is a “game changer”, that’s according to American stockbroker Wedbush, which upgraded its target to $20 from $15.
It sees VW injecting capital into a technology joint venture and collaboration that’s expected to see architecture and software that will power vehicles being developed by both companies.
Rivian expects to accelerate the development of its SUV, whilst VW expects to more quickly move towards having what it is describing as “software-defined vehicles” (SDVs).
“This is a core game changer for Rivian and changes the capital structure of the company looking ahead for the story and the Street's view at a key time,” Wedbush analyst Daniel Ives said in a note.
Ives described it as “a breath of fresh air”, as he penned the upgrade note.
“Rivian will leverage this opportunity by utilizing this robust capital roadmap to support future growth while vertically integrating its software platform and electrical architecture while achieving further cost savings and deliver improved vehicles down the line,” he said.
“Importantly, this partnership will provide capital needed for the R2 ramp and GA plant R2/R3 midsize platform which we view as a large step in the right direction and a key move for Rivian going forward.”
The analyst added the Wall Street will mainly still be focused on Rivian’s ‘profitability story’ and its execution – especially in regard to the delivery of the R2 model and the construction of its plant in Georgia.
Rivian stock was up 23.35% in Wednesday’s trading, at $14.75.
Universal Studios’ London’ would boost UK economy by $50bn
Comcast Corporation (NASDAQ:CMCSA, ETR:CTP2) owned Universal Studios has revealed that its planned new theme park in Bedfordshire could deliver a £50 billion boost to the British economy.
The proposed development is intended to span 192 hectares, rising potential to 217 hectares, and would also include a 500-room resort hotel, restaurants and theme park attractions.
Universal’s economic impact assessment report envisages that the theme park construction will create 20,000 jobs and, once in operation, it will support 8,000 permanent jobs – which the American firm has pledged to pay the ‘living wage’.
Projections see the theme park attracting millions of visitors annually, of which around a third are expected to be from overseas.
Modelled on a year-round, 365 day, schedule the project has an estimated net economic contribution of £35.1 billion over its first 20 years, plus a further £14.1 billion would be additionally generated in taxes.
Universal believes it has strong backing from local communities and MPs, with a survey finding that 92% of people are in support of the propsed theme park.
It comes as Universal is currently building a brand new and ambitious third theme park in Orlando, Florida, positioning its theme park business as a more competitive rival to Disneyworld.
Universal similarly has a rival park in California, where it competes with Disneyland.
With a park on the outskirts of London, Universal would be looking to compete with Disneyland Paris and domestic parks such as Alton Towers and Thorpe Park.
Disneyland Paris attracts more than 15 million theme park visitors, and Disney has eight resort hotels at the Paris parks.
Grindr lays out AI plan to launch new services and grow revenue
Grindr Inc (NYSE:GRND) has told investors that it is developing AI-powered tools ‘to help users more easily find long-term relationships’, along with new monetization opportunities.
In New York, the share soared more than 16%, to trade at $11.88, thanks to upgraded growth plans.
The gay dating app firm, which floated in New York through a SPAC deal in 2022, today held its first investor day in which it detailed a four-year plan that targets 20% to 25% revenue growth.
It is focused on user experience and seeks to drive long-term growth.
“We are improving connection and casual dating, which have always been core to Grindr, through a suite of features called Right Now, while also creating new AI-first features to help users more easily find long-term relationships,” chief executive George Arison said in a statement.
“We know our users want additional functionality to help them better access other types of social connections and to access curated, relevant information and services that will enhance the quality of their lives.”
Supported by AI tools, Grindr plans to develop and launch eight new products for user engagement – around its core use cases which include ‘connectivity, dating, relationships, and the ‘Gayborhood’.
Grindr describes Gayborhood use cases as “new partnership-based digital services typically found in physical gayborhoods”, these partnerships are expected to comprise travel, wellness, and entertainment experiences – and, currently, are outside of the company’s 20-25% revenue growth projections.
“Grindr has built a durable financial model that is delivering strong, reliable growth as we execute on our monetization strategy,” chief financial officer Vanna Krantz added.