Introduction
We are excited to release the first issue of our monthly newsletter Sector Spotlight
This is a comprehensive newsletter coupled with decks for the current or aspiring investment banker/PE investor, diving deep into the qualitative and quantitative nature of transactions, businesses, and trends across sectors, from the POV of an investment banker/PE investor. The groups are led by incoming investment banking summer analysts & analysts across a range of bulge bracket, elite boutique, and middle market banks.
Unlike other finance newsletters, this will not just simply mention or briefly summarize deals and news but will link to decks that include in depth analysis on a given topic. As this is the first issuance, we’ll be covering three sectors: 1.) Media & Entertainment, 2.) , and 3.) Healthcare. We hope you enjoy this month’s edition and look forward to bringing you monthly updates moving forward. Enjoy!
Best,
Jagger Lambert lambertjagger@gmail.com
James Concepcion jamesconcepcion217@gmail.com
Technology
September 2023 Deals:
- ARM, the British semiconductor design company, held an initial public offering on the Nasdaq stock exchange which raising $4.87 billion. (See deck for more!) The IPO was the largest in London history, and valued ARM at $54 billion. ARM’s IPO was underwritten by Goldman Sachs, JPMorgan Chase, Barclays, and Mizuho Financial Group.
- On September 13, 2023, Cetera Holdings announced that it would be acquiring Avantax, a leading independent broker-dealer with over 3,000 financial advisors and $83.8 billion in assets under administration. The deal is valued at $1.2 billion, and is expected to close in the fourth quarter of 2023.
- On September 19, 2023, Runa Capital, a venture capital firm, made an unsolicited offer to acquire MariaDB, a leading open-source database provider. The offer is for $0.56 per share, which is a 40% premium. The offer is still in the early stages, and MariaDB has not yet decided whether to accept it.
- Cisco Systems Inc. announced its largest-ever deal, a $28 billion takeover of Splunk Inc. Deal was unanimously approved by the boards of directors on September 21. Tidal Partners, a boutique advisory firm started last year by former longtime Centerview Partners technology investment bankers, was Cisco Systems Inc.’s sole bank adviser on this takeover. Morgan Stanley & Qatalyst Partners advised Splunk
- On September 10, 2023, Intel sold a 10% stake in IMS Nanofabrication to TSMC for $430 million at a valuation of $4.3 billion.
September 2023 Trends
- See deck above for a deep dive into these topics and much more!
Virtual Reality
- The global VR market is expected to grow from $59.9 billion in 2022 to $431.2 billion by 2030, at a CAGR of 27.5%.
- Key improvement increasing the performance of VR headsets. The development of standalone VR headsets, the increasing use of VR for training and simulation, and the growth of VR gaming.
- Quest 3 the mixed reality headset for $500. More of a console compared to Apple’s Vision Pro, which is more of a productivity device. The Quest 3 could be a more affordable and accessible mixed reality headset than the Apple Vision Pro.
Quantum Computing
- The global quantum computing market is expected to grow from $812.6 million in 2022 to $8.2 billion by 2027, at a CAGR of 60%.
- Sam Altman and Jony Ive are working with TGT to build OpenAI’s consumer hardware. SoftBank’s founder is also involved in the discussions and pitched ARM’s potential involvement. SoftBank is looking to get ARM involved and provide $1 billion in financial backing.
- The FTC and 17 other states are suing Amazon for illegally maintaining monopoly power in the e-commerce and cloud computing markets. The lawsuit alleges that Amazon has used a variety of anticompetitive tactics to stifle competition and maintain its dominance.
Artificial Intelligence:
- ChatGPT can now “see” thanks to a new feature called multimodal GPT-3.5. This feature allows ChatGPT to process and understand images. To use this feature, you can upload or take a picture and send it to ChatGPT. ChatGPT will then analyze the image and provide you with a description of what is in the image.
Other Trends
- Productivity Measurement: A startup called Workforce Analytics has developed a platform that uses AI to measure employee engagement and productivity in real time, and has attracted the attention of global leaders such as Microsoft, Google and Amazon.
- AI-augmented software development: GitHub announced a new feature called CodeSpaces, which allows developers to create, edit and run code in the cloud using a browser or an editor of their choice.
