Our briefing for Thursday March 25, 2021:

Mar 25, 2021 3:51:59 PM

In the United States, President Joe Biden held his first news conference on Thursday since becoming leader just over two months ago, and pledged a new goal for his administration on coronavirus vaccine rollouts. President Biden announced his administration is aiming for 200 million vaccination shots into the arms of Americans during his first 100 days in office. During his campaign, the president promised 100 million vaccinations in his first 100 days – something his administration was able to achieve last week – 42 days ahead of schedule. “I know it’s ambitious, twice our original goal, but no other country in the world has even come close,” said President Biden.
Canada’s scientists at the National Advisory Committee on Immunization (NACI) are reviewing research that suggests people that have already been infected with COVID-19 might be good with just one vaccine dose. In an email, NACI chairperson Caroline Quach-Thanh said the committee is “debating” the question after “France and Quebec have said only one.” A small study in the United States suggests those who have been infected with COVID-19 may produce 10 to 45 times as many antibodies after the first dose of the Pfizer or Moderna vaccines compared with someone who hasn’t had COVID-19. The research has yet to be peer reviewed.
In the United Kingdom, MPs have voted 484 to 76 in the House of Commons to extend coronavirus laws into September. The laws allow the government wide-ranging powers from shutting down pubs, through to detaining individuals deemed at risk as part of efforts to contain the spread of the virus. Under the new legislation, Britons could also face a £5,000 fine if they leave the UK without a reasonable excuse. Health Secretary Matt Hancock told the House of Commons: “Although this Act remains essential and there are elements of which we are seeking renewal of, we’ve always said we would only retain powers as long as they are necessary.”
France’s President admitted on Greek television Wednesday that his government was caught flat-footed in regard to the country’s vaccination campaign. “We weren’t fast enough, strong enough on it,” said President Emmanuel Macron to Greek TV channel ERT. “You can give that to the Americans, as early as the summer of 2020 they said: let’s pull out all the stops and do it. They had more ambition than us. We didn’t think [the production of a vaccine] would happen that quickly.” President Macron went on to add: “Everybody, all the experts said: Never in the history of mankind was a vaccine developed in less than a year.” According to statistics, as of March 22^nd, 9.3% of France’s population had been partially vaccinated.
Bloomberg is citing Indian government officials with knowledge of the matter, that the country expects to slow exports of coronavirus vaccines as it looks to expand domestic inoculations. With India’s new cases steadily climbing over the last month, government officials announced earlier this week that it plans to expand its inoculation program to include everyone over the age of 45. Officials have stated the hold on exports may be reviewed in a month or two and India will honor commercial contracts even if at a slower pace. India has exported or donated more than 60 million shots as part of its vaccine diplomacy efforts.
In Japan, the official countdown of the postponed 2020 Tokyo Olympics began on Thursday with the first group of runners carrying the Olympic torch through Fukushima. Due to the pandemic, the ceremony was much more subdued than in previous years. The opening event was closed to the public and the few spectators that did show up were asked to wear masks and refrain from cheering or shouting. The torch relay was seen as the first test for organizers that insist a “safe and “secure” event in the midst of a global pandemic. Japanese Prime Minister Yoshihide Suga told reporters that “we [government] will do our utmost in terms of coronavirus measures and continue to work with related areas to contain the spread of infections and hope to work towards a safe and secure Games.”

Covid-19 – Due Diligence And Asset Management

Powell Likens Fed’s Pandemic Response to British at Dunkirk

Brief : Federal Reserve Chairman Jerome Powell compared the actions taken by the central bank early in the pandemic as the economy barrelled toward a recession to British efforts in World War II to evacuate troops at Dunkirk. Asked Thursday in an NPR interview whether he would have anything different back in March 2020 if given the chance, Powell said, “We almost certainly didn't do everything right but we knew at the very beginning that we should use all of our tools and use them as aggressively and extensively as we needed to.” The Fed slashed its key benchmark lending rate to a record low of 0% to 0.25%, created a number of emergency lending programs to shore up a financial system in crisis and began buying billions of dollars in bonds to keep long-term interest rates low. “We knew that we would never be able to explain in such an emergency situation why we hadn't used our tools in that way," Powell said. "So we did.” In that environment, with the U.S. economy facing peril on multiple fronts, Powell compared the urgency with which the Fed acted to the way the British deployed an impromptu regatta to evacuate thousands of its troops from Dunkirk in France that were surrounded by German forces.

U.S. Regulator Opens Inquiry into Wall Street’s Blank Check IPO Frenzy

Brief: The U.S. securities regulator has opened an inquiry into Wall Street’s blank check acquisition frenzy and is seeking information on how underwriters are managing the risks involved, said four people with direct knowledge of the matter. The U.S. Securities and Exchange Commission (SEC) in recent days sent letters to Wall Street banks seeking information on their special purpose acquisition company, or SPAC, dealings, the four people said. SPACs are shell companies that raise funds via a listing to acquire a private company with the purpose of taking it public, allowing such targets to sidestep a traditional initial public offering. The SEC, which declined to comment for this story, has previously said it was monitoring the SPAC boom, but the letters are the strongest sign yet that it is stepping up scrutiny of such deals and the Wall Street banks that underwrite them… Wall Street’s biggest gold rush of recent years, SPACs have surged globally to a record $170 billion this year, outstripping last year’s total of $157 billion, Refinitiv data showed. The boom has been fueled in part by easy monetary conditions as central banks have pumped cash into pandemic-hit economies, while the SPAC structure provides startups with an easier path to go public with less regulatory scrutiny than the traditional IPO route.

Private Equity Could be Set for a Rocket Recovery

Brief: During 2020, as the pandemic took hold across Europe, private equity funds based in Luxembourg continued to raise funds from institutional investors, asset managers, family offices and HNWIs across the world. Some of this money has already been put to work in support of companies that are hurt by the pandemic, protecting jobs and past investment, and smoothing the way to recovery. But by far the greater part of new funds raised will be invested in the high growth companies that are going to pull Europe out of the lockdown-induced recession. These two roles, shoring up good companies with temporary troubles and accelerating the growth of those that innovate and modernise, are central to private equity. The first group includes companies in hospitality, entertainment, travel and tourism, and the latter includes fast growing companies in technology, e-commerce and healthcare. Following the last major recession in 2010-11, companies owned by private equity emerged stronger and grew faster than others. This story is likely to repeat itself in 2021-22. Private equity’s strong focus on investment in growth and performance will make sure of that.

BC Partners Plans Sale of $1.7 Billion Pharma Firm Aenova

Brief: BC Partners is considering a sale of German pharmaceutical contract manufacturer Aenova, according to people familiar with the matter. The private equity firm plans to seek a valuation of more than 1.5 billion euros ($1.8 billion) for the business, one of the people said. BC Partners is working with Rothschild & Co. to gauge interest in Aenova, which could draw interest from buyout firms and other strategic bidders, the people said. Deliberations are ongoing and there’s no certainty they’ll lead to a sale, according to the people, who asked not to be identified discussing confidential information. Representatives for BC Partners and Rothschild declined to comment. Aenova provides product development and manufacturing services to pharmaceutical and consumer health care companies in 15 countries including Germany, Switzerland and Italy. It reported revenue of 726 million euros and a net loss of 53 million euros in 2019, according to its website. BC Partners acquired the business in 2012 in a 480 million-euro deal.

Many Businesses See Hybrid Work Continuing After Pandemic

Brief: Many businesses around the world expect employees to continue to work from home beyond the pandemic, according to a new report commissioned by Zoom Video Communications Inc. The study, conducted by Boston Consulting Group, found that a majority of businesses in five countries are considering a flexible remote-work model because of the successful use of video conferencing during the pandemic, and many expect a significant chunk of their workforce to continue to work remotely. In the U.S., 39% of businesses anticipate more than a third of their employees will work remotely after Covid-19 infections wane, which was the lowest response of any of the six countries surveyed. Companies surveyed in India were the most keen to keep work-from-home setups, with 47% saying the same. Responses in the U.K., France, Germany, and Japan were all above 40%. As vaccines are administered across the country, and pandemic restrictions loosen, companies are trying to chart a path forward. Last week, Ford Motor Co. told more than 30,000 employees that they can continue to work from home and use the office only when needed. Many firms in the financial industry are signaling they prefer a full return to the office.

TISE Increases Revenue and Profit During Pandemic

Brief: The International Stock Exchange Group Limited (TISEG/the Company) has released its latest Annual Report which shows record revenues of GBP8.4 million, a 4.2 per cent increase in post-tax profit to GBP3.6 million and an increase in earnings per share to 128.4p during the year ended 31 December 2020. As previously announced, during 2020 there were 831 newly listed securities on TISE, which is the second highest annual total of new listings since the inception of the Exchange. This took the total number of listed securities on TISE’s Official List to 3,162 at 31 December 2020. Charlie Geffen, Chair of TISEG, says: “It is pleasing that we have continued to make successful progress both organisationally and with increased profitability against the backdrop of the pandemic. At the 2020 AGM we announced a revised growth strategy which is an important step in the diversification of our products, geographies and markets. Our strong financial position gives us the ability and time to execute on our plans and Cees Vermaas’ experience from several major international exchange groups is already proving invaluable in achieving our goals.”

Coronavirus Diligence Briefing