Los Angeles readers: Axios and the U.S. Conference of Mayors tomorrow will host an event on the impact of technology and innovation on city infrastructure. It will include Mike Allen interviewing LA Mayor Eric Garcetti, New Orleans Mayor Mitch Landrieu, Dan Katz of Hyperloop One, and Dr. Mory Gharib of the CAST Center at CalTech. 8am PT at Union Station. You can get more information and register here.
Top of the Morning
House Republicans have settled their differences on taxes – or at least brushed them under the rug – as they have scheduled a press conference for 11:15am. There also is an on-the-record pre-brief for reporters beginning at 10:30am, so be sure to check Axios.com for updates soon.
Here's what I'll be listening for on the corporate side:
- Statutory rates: We all know about 20%, but don't know if there will be complications about how we get there (phase-in?) or if it would sunset (something that was circulating yesterday). Odds are on immediate and permanent.
- Interest deductibility: We're still hearing a German-style 70/30 rule. Key will be how existing debt is grandfathered, and if there is a kicker about "in process" leveraged finance.
- Carried interest: The big question here is if tax treatment is just being changed for hedge fund managers, or also for other sorts of general partners (e.g., private equity, venture capital, real estate, etc.).
- Nonprofit excise tax: There has been some talk that large, private universities could get dinged, which would effectively reduce their investable capital.
- Pass-through treatment: It may be way more complicated than we had initially expected.
- Repatriation: What's the rate and will there be any strings attached, perhaps tied to hiring, wage growth or R&D? Or are we about to see an explosion of stock buybacks?
• All hail breaks loose: I spent much of yesterday trying to figure out if Travis Kalanick or Benchmark Capital threw the latest screwball into SoftBank's attempts to launch a tender offer for Uber shares. What I know for sure is that a voting rights agreement that all parties must sign for the tender to launch remains unsigned due to disagreements over two issues: Whether Kalanick's board appointments are subject to majority board approval, and if Benchmark will suspend its lawsuit during the tender (and cease the lawsuit were the SoftBank deal to close).
- Next: The most sensible resolution here would be to table both until after the tender, although feelings on both sides are so raw that it may not happen.
- Open letter: One thing did become clear to me yesterday, while trying to sort through all the spin and legitimate differences of opinion: It would be best for Travis and Uber to make a clean break with one another. Yeah, I know – easy for me to say without $8 billion on the table. Nonetheless, here's my open letter to Uber's former CEO.
Venture Capital Deals
Private Equity Deals
- More from Cass Biz School report: "The failure rate for deals involving public company targets is significantly higher than for private targets. Since 1992, the long-term public target average failure rate was 11.1% compared to the long-term private target average failure rate of just 3.7%, and an overall average deal failure rate of 5.7%."