Bluebell puts a target on Larry Fink’s back

One scoop to start: Sam Bankman-Fried’s FTX reached the late stages of negotiating a sponsorship deal worth more than $100mn with Taylor Swift, but talks with the pop star fizzled out just months before the exchange’s collapse in November.

In today’s newsletter:

Bluebell goes right for the jugular

Old-school activist investors tend to have a similar playbook: pick a public company that is underperforming, acquire a sizeable stake and call for changes to be made to improve its stock price.

It’s not often that they pick one of the most successful companies in the world and ask for one of the most well-regarded investors to step down from the top job.

But that’s exactly what Bluebell Capital Partners has done with BlackRock and its chief Larry Fink.

The European activist is calling for Fink’s head over the “apparent hypocrisy” of the asset manager’s use of environmental, social and governance investment factors.

Before we go any further on this, let’s get the obvious out of the way: Fink isn’t going anywhere, at least not because of this.

Bluebell has a 0.01 per cent stake in BlackRock, which has a market capitalisation of $107bn. The activist has made some interesting points, though.

We’ve talked before about how tiny managers have been tackling bigger and bigger fish, the primary example being Engine No. 1 going after Exxon, typically by getting larger shareholders involved. But it’s difficult to imagine any major BlackRock investors calling for Fink’s resignation.

And while Bluebell has successfully punched above its weight before — it’s best known for helping dethrone a chief executive at Danone last year despite holding less than €20mn in shares and having total assets of €70mn — BlackRock, with its whopping $8tn assets, is a whole other beast.

Bluebell has touched on something though. BlackRock is getting grief from both sides of the sustainability debate: Democratic officials are complaining that the company hasn’t gone far enough in its support to reduce carbon emissions while Republicans in several states have pulled money out of BlackRock funds for being hostile to fossil fuel companies.

In its letter to BlackRock, Bluebell stated that “the reputational damage of being dragged into this politically charged debate, in our view, is very significant because it calls into question the independency of BlackRock as an asset manager.”

BlackRock’s ESG status has come into serious question since Tariq Fancy, the firm’s former sustainability boss, wrote several notes attacking its ESG agenda. But it seems like there’s something deeper going on here.

Bluebell’s frustrated that BlackRock didn’t support its position on environmental shareholder resolutions at other companies, such as Glencore and Solvay, and has decided to go after the world’s largest asset manager itself.

Europe runs low on unicorns

The year is 2020. In a signal of confidence in the Swedish streaming group and its European tech peers, Spotify boss Daniel Ek pledges to invest €1bn in early-stage “moonshots” that may be “too early” for most venture capital firms.

He may now be wishing he’d stayed on Earth. More than $400bn in market value has been wiped from European tech groups since the peak of the 2021 boom, as venture capital dealmaking has caved to the pressures of high inflation, rising interest rates and the war in Ukraine.

Ek wasn’t alone in his ambitions to take on Silicon Valley. Europe’s start-ups were on the receiving end of a funding frenzy in 2021 that birthed more than 100 “unicorns”, aka tech start-ups valued at more than $1bn.

That number has since fallen to 31 so far this year, according to a report by London-based venture capital firm Atomico.

There were a few reasons for this. Raising the kind of “super-companies”, as Ek once described it, with the power to attract top talent and venture capital dollars doesn’t happen overnight.

Europe lacks the local infrastructure of Big Tech companies to make “acquihires” — acquisitions targeted around sourcing talent rather than tech or profits — that are still commonplace in Silicon Valley, said Harry Nelis, a partner at Accel.

“There is a bit more of a safety net in the US, where companies that are failing may be hoovered up by the big companies,” he added.

Investors say that confidence, not capital, is the problem. There’s still about $80bn worth of venture capital “dry powder” available in Europe, Atomico estimates, but investors remain skittish.

Many bemoan a lack of support for tech companies from more traditional investors in Europe. “The panic is worse in Europe than the US among generalist fund managers,” said one VC, likely sending European founders back to the US when the IPO market does finally reopen.

“I’ve been in this game for 20 years and it is exceptionally hard to read the tea leaves at the moment,” said Nic Brisbourne, managing partner at London-based Forward Partners.

It turns out that some US firms including so-called crossover funds including Tiger Global and Insight Partners have begun pulling back from the continent out of fears that a recession could last longer in Europe than in the US.

One of the highest-profile unicorns to feel the pain was Swedish “buy now, pay later” fintech Klarna, whose valuation dropped from $46bn to $7bn following a funding round in July.

“Suddenly people don’t want you to lean into the future but they want you to show profitability,” said Klarna’s CEO Sebastian Siemiatkowski at a tech conference on Wednesday. “Unfortunately as a consequence of that we had to shift back.”

Job moves

• Caio Mário Paes de Andrade, the fourth CEO of Petrobras in less than two years, is to leave the Brazilian state-controlled oil producer after accepting an invitation to join the incoming administration of the newly elected governor of São Paulo state.

• Fiona Frick is stepping down as chief executive of Swiss asset manager Unigestion. She’ll be replaced by head of private equity Christophe de Dardel in January.

• FTX founder Sam Bankman-Fried has retained defence attorney Mark Cohen of Cohen & Gresser, while Caroline Ellison, who ran SBF’s trading firm Alameda Research, has hired Washington-based firm WilmerHale to represent her, according to Reuters.

• BNP Paribas has hired seven senior executives for its global markets Americas platform from Morgan Stanley, Hayfin Capital Management, RBC, Stifel, Cantor Fitzgerald, Mizuho and CIBC Capital Markets.

• Evonik chief financial officer Ute Wolf is stepping down. He’ll be replaced by Maike Schuh, who leads the German chemicals group’s performance materials division.

• Goldman Sachs alum Nishant Roy has been appointed chief communications and impact officer at yoghurt maker Chobani. He was most recently chief of strategic operations and chief of staff for Chobani’s founder Hamdi Ulukaya.

• Standard Chartered has hired Asia credit traders Chirag Srivastava and Wilfred Lee from Deutsche Bank and Mizuho, respectively, according to Bloomberg.

Smart reads

Big spender Asia’s richest man Gautam Adani is embarking on a massive fundraising effort to fuel his rapid expansion, he told the FT in an interview. High leverage and investor pressure to move away from fossil fuels pose big challenges ahead.

One glass ceiling of many Women are deeply under-represented on Japanese boards. The ascent of Makiko Ono, the future chief of drinks group Suntory, shows how far the country has yet to go to address its corporate gender imbalance.

And one smart listen: Credit Suisse is attempting to write a comeback story after years of scandal and losses. The FT’s European banking correspondent Owen Walker lays out the stakes on Behind the Money.

News round-up

Blackstone chief dismisses concerns over $69bn real estate fund (FT + Alphaville)

Microsoft signs 10-year ‘Call of Duty’ deal with Nintendo (FT)

DWS weighs sale of private equity secondaries business in revamp (Bloomberg + Lex)

Washington Post considers selling tech business It built up on Jeff Bezos’s watch (Wall Street Journal)

Mining magnate Andrew Forrest becomes Australia’s largest renewables player (FT)

GSK and Sanofi shares surge after Zantac ruling victory (FT)

UK watchdog fines 3 traders for ‘market manipulation’ in Italian bond futures (FT)

Trump Organization convicted of tax fraud in Manhattan trial (FT)