From Japan's deals abroad to a new executive role for AI expertise – Here are today's Headlines

On Thursday, Renesas said it's buying Altium for US$5.9 billion in cash.

From Japan's deals abroad to a new executive role for AI expertise – Here are today's Headlines
A man uses a laptop on a bench at a business district in Tokyo, Japan January 23, 2024. REUTERS/Kim Kyung-Hoon

To start off, we're looking into:

Renesas buys Altium for US$5.9 billion

The backstory: Renesas, a Japanese semiconductor powerhouse, is known for making essential integrated circuits, particularly for cars. It started in 2010 when the chip divisions of NEC Electronics Corporation and Renesas Technology (a merger of Hitachi and Mitsubishi Electric) merged. On the other hand, Altium, a software company with roots in the US and Australia, is known for its electronic design software called Altium Designer. In 2021, Altium made headlines by rejecting a buyout from Autodesk, saying it was too low of an offer. 

More recently: Lately, it seems like Japan has been making a lot more deals abroad. For example, last year, there was a big increase in outbound mergers and acquisitions in the country. December's data from LSEG showed a 71% jump in Japan's outbound deals in 2023, reaching US$56 billion.

Japanese companies like Nippon Steel and Sekisui House have been expanding abroad, possibly due to challenges at home, like the country's aging population. For instance, Nippon Steel sealed a deal in December to acquire US Steel for US$14.1 billion. Renesas is also joining in, with plans to buy a US-based power semiconductor company called Transphorm Technology for US$339 million later this year.

The development: On Thursday, Renesas said it's buying Altium for US$5.9 billion in cash. Click the link here for more.

The SEC greenlights Trump's Truth Social merger

Donald Trump Truth Social Digital World
Former U.S. President Donald Trump gestures during a campaign event in Waterford Township, Michigan, U.S., February 17, 2024. REUTERS/Rebecca CookJa

The backstory: Donald Trump, a prominent figure in American politics and business, served as the 45th President of the US from 2017 to 2021. Known for his unconventional approach and controversial policies, Trump had a relatively successful career before that in real estate and on TV, notably developing Trump Tower in New York City and starring in the reality show "The Apprentice." And, after his presidency, Trump stayed active, launching Truth Social as an alternative to mainstream social media platforms. This came after he was banned from major ones like Twitter (now known as X) following the Capitol attack by his supporters in 2021. Truth Social is managed by Trump Media & Technology Group (TMTG).

Now, onto the business side of things. Digital World Acquisition, a company specifically set up for acquiring other businesses, teamed up with TMTG in late 2021 for a merger. But Digital World faced some hurdles over the deal, with investigations by the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) as well as executive and board shakeups.

The development: The US SEC has given the thumbs up to the merger, so Digital World can now set a vote for its shareholders to complete the deal. Click the link here for more.

Softbank’s AI bet

Softbank Arm Nvidia artificial intelligence
Source: FILE PHOTO: SoftBank CEO Masayoshi Son speaks at the SoftBank World 2023 corporate conference, in Tokyo, Japan, Oct. 4, 2023. REUTERS/Francis Tang/File Photo

The backstory: Japanese investment company Softbank was founded by Masayoshi Son in 1981. It has invested in many well-known businesses over the years – for example, the flexible workspace company WeWork and Chinese e-commerce giant Alibaba. In 2016, Softbank invested in the UK chip design company Arm. Arm doesn’t actually make semiconductors (aka chips), but instead, it creates the "architecture" or chip designs for companies like Nvidia, Apple, Alphabet and Samsung. Softbank also used to have a US$3.6 billion stake in chipmaker Nvidia, but it dropped all of it in 2019. 

Nvidia is one of the world’s top chip suppliers for major tech companies like Amazon, Microsoft, Alphabet, Meta and Dell. This is because the graphics processing units (GPUs) it makes are the best on the market for artificial intelligence (AI). And, as the AI sector booms, businesses everywhere are racing to develop AI technology. But high demand (among other things, like supply chain issues) also led to a shortage of chips and a long waiting list. So, big companies like Meta and Amazon have started creating their own chips.

The development: Son’s Softbank first invested in Alibaba when it was just a startup in 2000. Over the last 23 years, it’s made more than US$70 billion off that bet. Now, Son is turning his eye toward the AI boom. He’s considering a new US$100 billion chip venture to rival Nvidia, as first reported by BloombergClick the link here for more.

To end, we'll look into:

What's a chief AI officer?

Chief AI officer
Source: Pexels/Andrea Piacquadio

There’s a new seat available at the C-suite table; It's the chief AI officer (CAIO). And, according to executive search and leadership advisory firm Heidrick & Struggles, you’ll get paid over US$1 million on average to do it.

With the landscape of artificial intelligence (AI) constantly evolving and changing, many companies are considering bringing on a CAIO to manage the technical aspects of AI and come up with a strategy to leverage this advanced tech in a way that aligns with the company’s overall goals.

But, it’s been difficult for recruiters and companies to find someone to fit the bill for this new executive title because of the specifics of the role. It requires more than just a computer science background – a CAIO would need to be familiar not only with AI tech but also have experience in executive leadership and have knowledge beyond the techy parts (for example, on the ethical use of AI). Click the link here for more.

In other news ...


📉Market snapshot and key quotes:

  • In the US: The US market was closed today for George Washington’s birthday, known as Presidents’ Day.
  • In Hong Kong: Hong Kong stocks fell on Monday after the Chinese central bank kept a key rate unchanged to stabilize the yuan. The People’s Bank of China decided to keep a key policy rate steady at 2.5% on a one-year medium-term lending facility worth 500 billion yuan (US$69.5 billion).

📊Top gainers/losers and company news:

  • In Hong Kong: dropped over 4%, while Xiaomi and Baidu lost 3.7% and over 3%, respectively. Meituan, Alibaba and Tencent also saw declines of over 2%. 

👀The numbers everyone is watching:

  • In the US: In the US, the Fed January meeting minutes will be released, and Nvidia will report earnings.
  • In Hong Kong: China will release China loan prime rates and China property prices this week. 

📅To check out our economic calendar for this week, click here.

More headlines ...

📰Middle East update: Since November, the Iran-backed Houthis based in Yemen have been attacking cargo ships in the Red Sea, disrupting the international trading route. Its most recent target was a UK-registered cargo ship, the Rubymar, operated by the Lebanese, according to private security firm Ambrey. The ship was attacked off the coast of Yemen after the US military acknowledged conducting new airstrikes targeting the Houthis. All crew members abandoned the ship to safety. 

Oil prices settled slightly higher on Monday as supply concerns continue while the conflicts in the Middle East show no signs of easing anytime soon. Brazil also recalled its ambassador to Israel after Israel reprimanded them over Brazilian President Lula's comment comparing the Israel offensive in Gaza to Hitler's treatment of Jews. Meanwhile, the US has proposed an alternative draft of a UN Security Council resolution calling for a ceasefire and opposing a ground invasion into Rafah, according to text seen by multiple media outlets. It's not clear yet if the draft will be put to a vote. 

💔Papua New Guinea killing: On Sunday, dozens were killed in a tribal dispute in the Highlands region of Papua New Guinea, according to local authorities. The violence over the distribution of land and wealth has only worsened since it began in 2021, as there has been a flood of illegal firearms in the country. 

🗞️Putin accused of killing Navalny: We reported yesterday that Alexei Navalny, a leader of the Russian opposition, recently died in an Arctic penal colony. Now, his widow, Yulia Navalnaya, has accused Russia's President Vladimir Putin of killing her husband. She vowed to continue her husband's work and called on opposition supporters to fight even harder against Putin. Many others in the international community have also speculated that Putin is behind Navalny's death, which Russia has denied. The Kremlin said there's an ongoing investigation into Alexei Navalny's death, but his mother is still being denied access to her son's body. 

📩Pakistan election rigging?: Accusations of election rigging often come up in Pakistan, but now a commissioner named Liaquat Ali Chattha has resigned, saying he was involved in manipulating votes in the most recent election with the help of the Election Commission of Pakistan. Former Pakistani PM Imran Khan, who is in jail for multiple convictions including corruption, has said his charges are politically motivated. Khan's party has now called for an official judicial commission to investigate the claims of election rigging.

🥼Indonesia poll worker deaths: Indonesian elections are no small feat – and the workers running the polls have to work around the clock to distribute, count and report hundreds of paper ballots. This process could last more than 12 hours after polling booths close. Last week's election in the nation was the world's largest single-day election, with about five million paid volunteers working at 800,000 voting booths across the country. Some 4,000 of those workers fell sick in the last week due to fatigue, with 71 people so far dying from exhaustion.

🚜More farmer protests: Hundreds of Czech farmers disrupted traffic outside the Agriculture Ministry as they drove their tractors into downtown Prague on Monday, joining protests across Europe over high energy costs and the EU's Green Deal. Other protests have gathered farmers in Poland, France, Germany, Spain and Italy to fight issues like low prices for crops, floods of cheap imports and EU climate change policies that they say are hurting rural workers.

🔎EU investigates TikTok: The EU has begun an investigation into TikTok about its alleged breaches of child protection online under the bloc's new Digital Services Act. This move comes after concerns were raised over a risk assessment report from TikTok. Brussels is concerned that the algorithms used to streamline content for users may lead to more dangerous content, and the European Commission also said that TikTok's age verification "may not be reasonable, proportionate and effective." 

⚽Messi addresses Hong Kong drama: Following a friendly match in Hong Kong between Inter Miami and a local team earlier this month, Argentinian football legend Lionel Messi stayed on the bench for the entire match, sparking outrage among spectators who had shelled out a lot of cash and even traveled from foreign countries to see him play. Messi has now released a video on Weibo addressing the situation. "I've heard people say that I didn't want to play for political reasons and many other reasons that are totally untrue," Messi says in the post, adding that he wanted to play but couldn't because of an inflamed muscle.

👩‍⚕️South Korean doctor strikes: In South Korea, 2,700 interns and residents at five major general hospitals submitted their resignations for a walkout on Tuesday after the government proposed a plan to increase medical degree quotas at universities to deal with a physician shortage. This would mean more doctors in the country, which currently has one of the lowest ratios of doctors to people in the developed world. A doctors' labor group warned the government that it would face catastrophic consequences if it followed through with its plan. The government said it would respond firmly if the doctors continued their strike, with PM Han Duck-soo urging them not to go through with it. 

💰Indonesia's "Swiftonomics": Indonesia is turning to what Tourism Minister Sandiaga Salahuddin Uno calls "Swiftonomics" to boost the country's tourism, referring as an example its neighbor Singapore, where US pop sensation Taylor Swift will perform and bring in a lot of regional visitors. The country plans to introduce more incentives to attract music, culture and sports events in the hope that travelers will spend more and stay longer. The government has formed a 1 trillion rupiah (US$64 million) tourism fund to help bid for these events.

🏀Kai Tak Sports Park 2025: Hong Kong's long-awaited Kai Tak Sports Park is now set to open in 2025 to the public, and the work will be completed at the end of this year. The sports park includes a stadium to host major events and modern and multipurpose sports and recreation facilities to boost the city's sports culture.

📃Star Wars script sold: An original draft "Star Wars" script left behind in a London apartment rented by actor Harrison Ford, who played Han Solo, was sold over the weekend at a UK auction for about US$13,600 (HK$106,000) to an Austrian collector. Ford used the script while he was filming the first installment of the saga, which was originally entitled "The Adventures Of Luke Starkiller."

Quiz Time!

What major chipmaker is Softbank reportedly hoping to challenge with a new chip venture?

  1. AMD
  2. TSMC
  3. Micron
  4. Nvidia

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Written and put together by Joey Fung, Alisha Khan and Christine Dulion

**The answer to the quiz is [4]