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Claire Yubin Oh4h

Confluent soars on IBM’s $11 billion all-cash acquisition

Confluent went vertical in premarket trading on Monday before trading was halted as IBM announced that it’s acquiring the data infrastructure company for $11 billion to create a “Smart Data Platform for Enterprise Generative AI.”

IBM will acquire Confluent for $31 per share in cash for all issued and outstanding common shares of the company, representing a ~35% premium to Confluent’s Friday close, which pegged the company at a $8.14 billion market cap. The transaction is expected to close by the middle of 2026.

“With the acquisition of Confluent, IBM will provide the smart data platform for enterprise IT, purpose-built for AI,” IBM CEO Arvind Krishna said in the press release. The deal builds on IBM’s hybrid cloud and AI strategy, bullish that global data will more than double and over 1 billion new applications will emerge by 2028 from the continued adoption of AI. Confluent is a open-source platform that processes real-time data often used for big AI models.

IBM is down 1% on the news, though the latest acquisition marks the biggest deal for the tech giant in recent years, as the company works to increase spending on cloud and AI-related services after growth slowed down in its core cloud software business last quarter.

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Warner Brothers To Put Itself Up For Sale

Paramount launches hostile takeover bid for Warner Bros. Discovery at $30 per share, trying to upend Netflix deal

Paramount is taking its Warner Bros. Discovery purchase effort straight to shareholders.

Max Knoblauch48m

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Max Knoblauch2h

Rivian, Lucid, and Tesla all downgraded by Morgan Stanley on tougher EV market

US EV makers are seeing red in premarket trading on Monday, following a fresh downgrade from Morgan Stanley. Lucid, Rivian, and Tesla shares were all trading lower in early hours.

Analyst Andrew Percoco downgraded Rivian from “equalweight” to “underweight” and dropped his price target to $12 — 33% below the stock’s price as of Friday’s close. Percoco wrote that Rivian faces a host of upcoming headwinds, fueled by slowing adoption amid the end of the EV tax credit. According to Morgan Stanley, Rivian’s lower-priced R2 SUV could cannibalize demand for its other vehicles.

The firm also downgraded Lucid to “underweight,” slashing its price target to $10 from a previous target of $30. The new figure would represent an all-time low for the luxury EV maker. Percoco highlighted the potential for further dilution for Lucid investors given the company’s cash needs.

Morgan Stanley downgraded Tesla from “overweight” to “equalweight,” citing high AI expectations, but the bank bumped its price target to $425.

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CoreWeave tumbles after announcing $2 billion convertible debt offering

Shares of CoreWeave tumbled in early trading after the company announced plans to raise $2 billion through the sale of convertible senior notes due in 2031 in a private offering.

The deal includes an option to boost the sale to $2.3 billion. Some portion of the capital raised will be used to enter into capped call transactions designed to limit potential dilution in the event the stock rises enough that noteholders convert their holdings to shares, and the remainder of the funds will be used for general corporate purposes.

While much of the focus on AI credit risk has centered on Oracle, CoreWeave hasn’t been immune from fixed-income jitters. Its existing 2030 and 2031 notes, which carry coupons of 9.25% and 9%, respectively, saw significant selling pressure from early October through late November.

It’s also been viewed as a less than pristine customer by credit investors. Investors demanded a higher coupon for Applied Digital’s bond offering compared to similar offerings by Terawulf and Cipher, in part because those companies are being backstopped by Alphabet, while Applied Digital is relying on CoreWeave as its key tenant.

A month ago, the company announced that it had increased its revolving credit facility to $2.5 billion, from $1.5 billion, to provide “enhanced flexibility” and “support its growth initiatives.”

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Micron rises on price target boost, positive signs from overseas on memory chip pricing

Micron is starting this week as it ended the last one — trading up — with the stock about 2.6% higher as of 7:35 a.m. ET on Monday.

Susquehanna boosted its price target on the US memory chip specialist by 50%, to $300, while maintaining a positive rating on the stock.

Micron’s early advance is also in keeping with recent performance of its peers overseas.

South Korean memory giant SK Hynix soared on Monday, with Shawn Oh, head of Korea cash equities at NH Investment & Securities, telling Bloomberg that the gains were tied to strong pricing for the HBM3e line (the most recent generation of high-bandwidth memory chips) as well as fresh chatter about ADR issuance.

A local brokerage also boosted its SK Hynix price target, estimating that the South Korean company’s operating profit will double this year thanks to the surge in memory chip prices.

Separate reporting from ZDNet Korea indicated that SK Hynix is also delaying the ramp in its HBM4 production, in part to better align the release with Nvidia’s upcoming Rubin chip.

The potential for ADRs would effectively introduce some fresh competition for memory chip investment dollars among American investors, but SK Hynix’s postponement may reinforce demand for Micron’s existing HBM3e chips and give the American company more time to develop its own HBM4 chips.

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Robinhood rises after announcing entry into Indonesian market through acquisitions

Robinhood Markets is entering the Indonesia market by way of acquiring a brokerage and digital financial asset trader in the Southeast Asian country.

On Sunday, the company announced that it reached agreements to purchase PT Buana Capital Sekuritas and PT Pedagang Aset Kripto, with management expecting the acquisition to close in the first half of next year.

(Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company subject to certain legal and regulatory restrictions.)

Indonesia boasted 19.1 million individual investors as of October, per data from the Indonesia Central Securities Depository, up from less than 4 million at the end of 2020. Over half of these investors are below 30 years old, and another quarter are 40 or younger.

Patrick Chan, head of Asia at Robinhood, told reporters that the company plans to roll out a local app for stock and crypto trading by early 2027.

Shares of the brokerage platform are on the rise this morning, which may be in part due to this new access to Indonesian retail traders, as well as renewed interest in two of the more speculative themes — smaller AI energy plays and quantum computing — enjoyed by its US retail investors.

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