Spain’s migrant crisis exposes serious challenges for young Moroccans

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FT News Briefing 12 min 2 speakers 6 chapters transcribed 1 month ago
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What is the main topic discussed in this episode?

Victoria Craig 0:02
Good morning from the Financial Times. Today is Tuesday, August eleventh, and this is your FT News briefing. Wall Street and NVIDIA are working on a whopper of a financing deal, and we hear why pharma mega merger talks collapsed. Plus, Spain's migrant crisis has exposed serious challenges for young Moroccans.
Malaika Tapper 0:24
Even those who had been through really harrowing experiences crossing a border into Sioux Dan only to be sent back said that they were more than willing to try again despite the danger.

What is the $500 billion AI financing deal between Wall Street and Nvidia about?

Victoria Craig 0:34
I'm Victoria Craig, and here's the news you need to start your day.
Victoria Craig 0:49
The world's biggest financial groups are teaming up with NVIDIA on one of Wall Street's most ambitious lending efforts ever. The company announced late Monday it has signed a memorandum of understanding with finance industry titans, including Apollo Global, BlackRock, and Goldman Sachs. They'll create a $500 billion funding package for developing AI infrastructure like chips and data centers. Right now, most of the leading American AI models rely on NVIDIA chips. The company often provides financial backing to help AI partners raise debt in capital markets. That in turn helps boost NVIDIA's revenue, but it's raised concerns about concentrated risk in the sector. As for the deal, it's still subject to final approvals.
Victoria Craig 1:33
Shares of NVIDIA fell about 1% on Monday after the FT first reported the agreement.
Victoria Craig 1:44
From one deal now to another, a potential blockbuster merger between pharmaceutical giants AstraZeneca and Bristol Meyer Squib has been put on ice. Last week we told you the pair were in talks to combine in what would have been one of the industry's biggest ever deals. But investors were not so pleased with that idea. Oliver Barnes, one of our deals reporters who helped break that story for the FT, joins me now to talk about what happened. Hi, Oliver.
Oliver Barnes 2:09
Hey, thanks for having me.
Victoria Craig 2:10
So your reporting found that the companies actually wanted to announce this deal in mid-August. So what happened? Why did the talks break down?
Oliver Barnes 2:18
Well, in a nutshell, it unraveled in part because the news got out there, right? With these cross border, very stock based transactions, which are very large, they've been out of favor in the pharmaceutical industry for quite a few years now. If you look at the pharma industry, in the late nineties and early two thousands, we saw this kind of wave of consolidation, which created many of the big drug makers we know today. Like it created AstraZeneca, it created Merck, it created Pfizer. Many of those deals didn't create a whole load of value for investors. So they've kind of gone out of vogue.

Why did the AstraZeneca‑Bristol‑Myers Squibb merger fall apart?

Oliver Barnes 2:52
So the investor reaction to the idea of AstraZeneca, even entertaining this, was very bad.
Victoria Craig 2:58
We should say AstraZeneca and Bristol Meyer Squibb declined to comment for your most recent story out today. But aside from mega deals being out of vogue in the pharma world, you also report that investors were worried about patent cliffs, which is when patents for drugs expire and then they can go generic. And there were also some concerns that this deal was just a way for the British company AstraZeneca to re-domicile essentially in the US, right?
Oliver Barnes 3:23
Yeah, because I mean when you look at AstraZeneca, you have like a high growth company that set a very ambitious target of reaching $80 billion in revenues by the start of next decade. When you look at Bristol Myers Squib, it's like the industry laggard, right? It's the sickest of all the children, right? Which has the biggest patent cliff in the next few years. So a lot of investors looked at it. It's like, why would a high growth company buy a company with a load of drugs coming off patent? And the reason a lot of people have come to is like, is it part of AstraZeneca's pivot to the US? Right most of their revenue's already in the US. The industry center, it's like orbital center is in the US. So it's not totally illogical to think that.
Oliver Barnes 4:01
But still, I imagine if this were ever to happen, they would need to square off with investors like other reasons for this, not just like empire building and and moving your frontier towards the US.

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