Markets Defused aims to give an easy-to-understand and straightforward recap of the day’s most engaging business and stock market news.
- Boeing pleaded guilty in crash cases, shares rose
- Delivery Hero stock hit as it faces larger European fines
- Paramount deal wrapped up by Skydance (finally)
- Carlsberg adds soft drinks with £3.3bn Britvic deal
- Corning stock surges thanks to AI boost
- Lucid stock boosted by jump in EV deliveries
Boeing pleaded guilty in crash cases, shares rose
Boeing Co (NYSE:BA, ETR:BCO) stock moved higher after the aircraft manufacturer agreed to plead guilty to conspiracy to defraud the United States, admitting it misled the Federal Aviation Administration (FAA) during the evaluation of the 737 MAX.
As a result of the agreement Boeing will not stand trail and the US will not pursue prosecution of Boing executives.
But, the plea agreement will cost the engineer up to $487 million.
It follows two fatal crashes involving the 737 MAX in 2018 and 2019, which claimed 346 lives, and is separate from more recent incidents and scrutiny over Boeing’s checks and quality control.
Families of the crash victims are said to oppose the plea deal.
In New York, Boeing stock gained $3.52 or 1.9% in Monday’s stock market dealing to trade at $188.45.
Delivery Hero (ETR:DHER, OTCQX:DLVHF) stock hit as it faces larger European fines
Delivery Hero (ETR:DHER, OTCQX:DLVHF) is facing €400 million of fines from the European Commission due to alleged anti-competitive practices.
The German food delivery app firm is alleged to have violated a number of EU competition rules with scrutiny focussed on potential collusion with other firms including exchanges of commercially sensitive information, and ‘no-poach’ agreements over staff.
An EC investigation was launched previously, following unannounced inspections in July 2022 and November 2023.
Delivery Hero (ETR:DHER, OTCQX:DLVHF) had recent ‘informal engagements’ with the European Commission, according to a statement, in which the company was told it would face higher potential financial penalties.
As a result, the company has warned investors that it would ‘significantly increase provisions’ for such penalties in its next financial results – it previously allocated some €186 million in 2023’s accounts for the matter.
Paramount deal wrapped up by Skydance (finally)
Paramount Global (NASDAQ:PARA) stock responded positively after the media conglomerate (finally) agreed to merge with Skydance Media, in a deal valued at $28 billion.
Skydance’s investor group, comprising David Ellison and Redbird Capital Partners, will acquire Paramount shareholder National Amusements for $2.4 billion, and spend $4.5 billion in a cash and stock deal to acquire Paramount’s publicly traded Class A shares and Class B shares.
It also committed to invest $1.5 billion of primary capital into the media group’s balance sheet.
After the transactions, Skydance will own 100% of Paramount’s Class A shares and 69% of its Class B shares.
The transaction price ($23 per A share and $15 per B share) represents a 48% premium for B share holders, and a 28% premium for A share holders.
It will see the control of the company move transition from Shari Redstone who, via National Amusements, owned 80% of Paramount’s voting rights. The transaction will mark the end of the Redstone family’s control of the group, built by its late patriarch, Sumner Redstone.
Ellison, a successful Hollywood producer, will run ‘new Paramount’ as chief executive and chair, supported by former NBCUniversal chief executive Jeff Shell, who will be company president.
In New York, Paramount stock was down 28 cents or 2.37% trading at $11.53.
Carlsberg adds soft drinks with £3.3bn Britvic deal
Danish beer brewer Carlsberg has agreed to buy soft-drinks and mixer firm Britvic PLC (LSE:BVIC) for £3.3 billion ($4.2 billion).
Carlsberg will pay Britvic shareholders 1,315 pence per share, improving on previously rejected lower offers.
Ian Durant, Britvic’s non-executive chair, said the deal creates an enlarged international group positioned for growth in multiple drinks sectors.
Carlsberg CEO, Jacob Aarup-Andersen, highlighted that the combination of Britvic’s soft drinks and Carlsberg’s beer portfolios enhances the enlarged company’s proposition in the UK and Western Europe.
PepsiCo, which in the UK and Ireland has its products bottled and distributed by Britvic, had already agreed to waive a ‘change of control’ clause, in a side-deal with Carlsberg, to facilitate a transaction. As such, the bottling operations will continue.
Corning stock surges thanks to AI boost
Corning Inc (NYSE:GLW, ETR:GLW), which makes fiber-optics and hardened glass for iPhones, saw its stock nearly 10% higher on Monday, as it revealed an AI-driven boost to its financials.
The company, in a statement, raised market guidance for its second quarter.
It said it now expects core sales of $3.6 billion, up from $3.4 billion, whilst core earnings (per share) will come at the high end of or slightly above its prior guidance range of $0.42 to $0.46.
The expectation-beating performance comes from ‘strong adoption’ Corning’s new optical connectivity products being used to support generative AI computation.
“These results reinforce our confidence in ‘Springboard’ – Corning’s plan to add more than $3 billion in annualized sales in the next three years as cyclical factors and secular trends combine,” Corning chief executive Wendell Weeks said.
Corning’s ‘springboard’ strategy aims to grow sales by an extra $3 billion per year, over the next three years, by tapping into ‘cyclical factors and secular trends’.
Lucid stock boosted by jump in EV deliveries
California-based electric vehicle firm Lucid Group Inc (NASDAQ:LCID) saw its stock rise on Monday thanks to a bullish manufacturing update.
Lucid told investors that both its production and delivery numbers were up for the second quarter of 2024.
It produced 2,110 vehicles and delivered 2,394 vehicles during the period, with the latter up some 70% year-over-year.
American EV peers Tesla and Rivian – both of which have proved more popular with investors – meanwhile reported recent downturns in output.
Fisker, another US EV maker, meanwhile filed for bankruptcy protection in June.
In New York, Lucid stock was up 12 cents per share or 3.92% changing hands at $3.05.
Lucid is scheduled to report its second quarter financials on 5 August.