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In today’s newsletter:
Outsiders hoping to rock the swatch
Swatch Group’s stable luxury brands (such as Omega worn by James Bond and Harry Winston, the jeweler to the stars) shine around the world as a Swiss precision manufacturing and prestige emblem.
But even first lady Melania Trump, who glides through the room for an inauguration ball in January with the Harry Winston Diamond Choker, hasn’t supported Swatch Group’s stock.
Earnings fell 75% last year, while stock prices fell in two years. Investors are increasingly irritated by the closure culture and poor performance in family-controlled groups.
And now, one shareholder is determined to shake things up.
Stephen Wood, a New York-based American investor with Greenwood investors, owns about 0.5% of the shares and is hoping to seize his board of directors’ seats at AGM on May 21st.
In an interview with FT’s Mercedes Ruehl, Wood called out the company to operate like a private family, especially for the benefit of the powerful Hayek family.
Hayeks owns 25% of the capital, but it retains its share of Lion’s voting rights thanks to Swatch’s dual-class equity structure.
Swatch was founded by the highly regarded Nicholas Hayek. But now it is run by his son Nick, the CEO, and his daughter Nayra, the chairman.
Wood’s pitch is that minority shareholders, especially those who own so-called bearer stocks, are not just the family behind the brand, but also the voice.
“The undervaluation is eye-opening. Swatches trade at about half their book value,” Wood said. “This is a once-in-a-lifetime opportunity in a luxurious space.”
Wood describes himself as a “constructivist” rather than an activist.
He hopes Swatch will communicate more openly with investors. This is an approach already pursued by Leonardo, an Italian aerospace and defense group who has been on the board since 2023.
Also, May 21st could not be the end of the story, even if Wood doesn’t succeed.
He wants to “keep friendly,” but according to Swiss law, there are many “different paths” in his efforts to win a board after the AGM, he said.
Rewinding the Empire of Dorahi
Two months after the restructuring of French Artis, the front is drawn ahead of billionaire Patrick Drahi’s next debt renegotiation in the massive debt and communications empire.
The investment group, which holds around 85% of its top-ranked debt of 8.2 billion euros at Altice International, which houses the assets of the group of Portugal, Israel and the Dominican Republic, is joining in ahead of the restructuring meeting.
The big question is whether it ends as friendly as the final round.
Despite a tough first talk about shifting assets from bondholders, Altice France’s restructuring ended with an agreement. Creditors were given 45% of their shares in exchange for a substantial debt reduction.
Altice International Bondholders wants another relatively drama-free process, but some large investment groups are eschewing that debt. They are worried that they only avoided taking the most aggressive course of action at the end due to certain quirks of French law.
Whatever the outcome of the next restructuring, there is growing belief from bondholders, bankers and rival telecom executives that they are more willing to dismantle the global telecom empire that Drahi built in an age of low-cost and simple money. (Of course, as long as he holds his billionaire status in the process.)
Altice-owned mobile operator SFR believes that Drahi can even fully exit his home market in France if other leading operators Bouygues, Xavier Niel’s Iliad and Orange allow competition regulators to make the integration.
Altice told FT that it “refused to comment on French rumors,” but its competitors certainly run slider rollers across every corner of the Drahi empire.
“It’s all for sale,” said another telecom executive.
The Millennium is getting old
Multi-manager companies have taken the hedge funds industry by storm when they became mainstream in the past decade.
Many specialist teams (each with different strategies) ordered large fees by many mal managers. However, they have consistently provided an attractive combination of leverage that consistently delivers returns to investors.
Currently, one of the world’s largest multi-managers is a talk to sell minority shareholder stakes, allowing outsiders to fold for the first time.
FT’s Harriet Agnew and Costas Mourselas reported that Millennium Management will talk to Petershill Partners of Goldman Sachs costumes and find a buyer of stock in the Millennium management company.
This shows that multi-managers stay here, marking a major moment in millennium history. Founder Izzy Englishman maintains sole ownership of the hedge funds of its entire existence for 36 years.
Hedge funds have historically focused on several strategies, and their fate mainly reflected the success and failure of these choices.
However, multilateral strategies have discovered sustainability through a vast array of “pods” pursuing a variety of tactics.
Millennium’s flagship fund – managed by the trading team of Colossal 330 – has on average earned an annual return of 14% since its inception in 1989.
The 76-year-old Englishman has given no indication that he is going to retreat, but the Millennium is clearly preparing for life without him.
In 2022, we changed our fee structure to get more predictable revenue. This is a move that makes the millennium more attractive when it decides to sell minority stakes or distribute capital between senior management positions.
And earlier this year, FT reported that it was working on a plan that the Millennium would give top executives the opportunity to own part of the management company.
It all refers to an increasingly institutionalized business model. The Maverick startup on Wall Street has multi-managers become part of the furniture.
Job movements
Paul Weiss’ partner Jae Johnson, former U.S. Homeland Security Secretary to the Obama administration, will retire from the company in June. He was appointed co-chair of the Columbia University Board of Trustees on Monday.
Barrickmining has stepped up its efforts to find a successor to CEO Mark Bristow, who said he had committed to staying with the company until 2028.
German real estate giant Vonobia is planning to hire Luka Music as its new CEO. Mucic will step down from his current job as Vodafone’s Chief Financial Officer early next year and assume the role.
Rentokil Initial is looking for a new CEO after announcing Andy Ransom will be resigning by the time of the 2026 Annual Meeting.
Smart Lead
Retail entry consumer businesses from Tesco to Walmart have failed to invade the Japanese market, Rex writes. But now, China’s competitors are successful.
According to Bloomberg, the economy white-collar defendant is fighting for pardon from Donald Trump. The lobbyist and consultant industry has sprouted to help them.
Cheatgpt New York Magazine followed students and professors to understand how AI chatbots changed higher education.
News Round Up
Openai plans to expand Stargate outside the US (FT)
Geely makes Zeekr private after a year after NY Float (ft)
China sees global turmoil as a “business-friendly” opportunity, says Novartis Chief (FT)
‘Woodoku’ Maker Tripledot Buy Applovin’s Mobile Games Business for $800 million (FT)
MHA agrees to a 24 million euro deal for Bakertily’s Greek and Cyprus Unit (FT)
Spanish Prime Minister Pedro Sanchez says blackout will not change renewable energy bets (FT)
Barclays AGM confused by pro-Palestinian protesters (FTs)
FOXCONN attacks landmark deals to make cars for Mitsubishi Motors (FT)
Due diligence was written by Arash Massoudi, Ivan Levingston, Ortenca Aliaj, Alexandra Heal, Robert Smith, James Fontanella-Khan, Sujeet Indap, Eric Platt, Antoine Gara, Amelia Polarard, Maria Heeter, Kaye Wiggins, Oliver Barnes and fr barnes John of London. Arjun Neil Alim in Hong Kong. Send feedback to due.diligence@ft.com
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