April 16, 2024

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Top of the Morning

Illustration: Sarah Grillo/Axios

A regulation twofer today...

The Department of Justice (DOJ) is planning to sue Live Nation, one of the largest ticketing and live events companies in the country, on antitrust grounds, according to my colleague Sara Fischer.

Why it matters: The company faced intense scrutiny from lawmakers and consumer advocacy groups over botched ticket sales for Taylor Swift's Eras Tour in late 2022.

Catch up quick: Live Nation acquired Ticketmaster in 2010. The DOJ at the time didn't sue to block the deal, but through a consent decree it barred the company from pressuring concert venues to use its ticketing software.

  • The ten-year decree was extended for more than five years in 2020.
  • Artists have long spoken out about Ticketmaster's practices, but those murmurs turned into rallying cries after Ticketmaster's site crashed for thousands of Taylor Swift fans in 2022.

The big picture: The lawsuit would represent the latest big complaint against a major company by the DOJ during the Biden administration.

  • The DOJ sued Apple in March for abusing its dominant position in the smartphone and app markets. It has sued Google multiple times since 2020.

The other side: The company has tried to counter the narrative that it's responsible for inflated ticket pricing, arguing in a blog post last month that tickets "are actually priced by artists and teams."

  • Some analysts have argued a lawsuit would most likely end in a settlement, given that the government's complaint reportedly won't target the company's fundamental business model, but rather some of its business practices.
  • The DOJ and Live Nation declined to comment.

Meanwhile...

MGM has sued the Federal Trade Commission to block its probe into a hack last year and its potential impact on the impact on data security.

The intrigue: MGM is asking that FTC chair Lina Khan recuse herself from the case because she was checking into an MGM hotel when the hack crashed its systems.

State of play: MGM is arguing that because it's not a financial institution, it's not subject to the FTC's rules over consumer financial data.

  • MGM also disclosed that the breach cost tens of millions of dollars in damages and that it's now facing 15 consumer class action lawsuits.

The BFD

Illustration: Allie Carl/Axios

Microsoft (Nasdaq: MSFT) is acquiring a $1.5 billion stake in G42, an Abu Dhabi-based AI company, per media reports.

Why it's the BFD: The deal was brokered by the Biden administration in an effort to box out China from having too much influence over the Gulf region's AI boom.

Details: G42 will get permission to sell Microsoft services that use powerful AI chips.

  • In return, G42 will use Microsoft's cloud services and operate under a security arrangement blessed by the U.S. government that includes restrictions on how the AI products can be used, and requires G42 to stop using Huawei equipment, among other steps.
  • A second phase of the deal, not yet negotiated, could include transfer of some of Microsoft's AI technology to G42.

The bottom line: "The investment could help the United States push back against China's rising influence in the Gulf region. If the moves succeed, G42 would be brought into the U.S. fold and pare back its ties with China. The deal could also become a model for how U.S. firms leverage their technological leadership in A.I. to lure countries away from Chinese tech, while reaping huge financial awards." — Paul Mozur, David E. Sanger, NYT

Venture Capital Deals

Rivos, a Santa Clara, Calif.-based RISC-V server tech company, raised more than $250m in additional Series A funding led by Matrix Capital Management, with Intel Capital, MediaTek, Cambium Capital, CIDC, Capital TEN, and Hotung Venture Group, Walden Catalyst, Dell Technologies Capital, Koch Disruptive Technologies, and VentureTech Alliance also participating. rivosinc.com

🚑 Sunstone Capital invested $200m in Accuhealth, a McAllen, Texas-based remote patient-monitoring company. axios.link/49DpSZh

🚑 Two Chairs, an S.F.-based in person therapy startup, raised $72m in Series C equity and debt led by Amplo and Fifth Down Capital, with Bridge Bank providing the debt financing. axios.link/49JCPRf

⛽️ GridBeyond, an Irish power grid software company, raised €52m ($55m) in Series C funding led by Klima, with Energy Impact Partners, ABB, Constellation, Yokogawa Electric. axios.link/49DBkUV

Uni Express, a Canadian delivery startup for e-commerce, raised $50m in Series C funding led by DCM. axios.link/3xHmyPO

🌎 Bcomp, a Swiss supplier of flax-based textiles to BMW and Volvo, raised $40m in Series C funding led by EGS Beteiligungen, with Verve Ventures, Zürcher Kantonalbank, RKKVC, Generali, Airbus Ventures, BMW i Ventures, Porsche Ventures and Volvo Cars Tech Fund also participating. axios.link/3JgNatr

🌎 Quilt, a Redwood City, Calif.-based heat pump startup, raised $33m in Series A funding led by Energy Impact Partners and Galvanize Climate Solutions, with Garage Capital, Gradient Ventures, Incite Ventures, MCJ Collective, Lowercarbon Capital, and Drew Scott also participating. axios.link/3Jh8NK6

Finmid, a German embedded fintech startup, raised €23m ($24.7m) in Series A funding from Blossom Capital, Earlybird VC, and others. axios.link/49CYpa3

🚑 Dot Compliance, a Phoenix-based life sciences quality management software company, raised $17.5m in additional Series B funding led by IGP Capital and Vertex Ventures, with TPY Capital also participating. axios.link/3PXU9ef

Dark, a French startup cleaning up space debris, raised $6m in a funding led by Eurazeo, with Long Journey Ventures and Frst also participating. axios.link/3UhbKRc

NightVision, a Bradenton, Fla.-based software security testing startup, raised $5.4m in seed funding from undisclosed investors. axios.link/3W3PKdJ

Draftboard, a N.Y.-based recruitment referral startup, raised $4.1m at a $13m valuation from Founder Collective and Twelve Below. axios.link/3JkMH9t

🌎 HyLight, a French startup hydrogen-powered airship drone startup, raised $4m from Y Combinator, Ring Capital, Kima Ventures, and Collaborative Fund. axios.link/4aYFZSv

Take2 AI, a N.Y.-based AI-powered job simulation platform for sales recruiting, raised $3m in seed funding led by Reach Capital and SemperVirens, with Techstars and others also participating. take2.ai

Isospec Analytics, a Swiss molecule analytics company, raised $1.9m in pre-seed funding led by Founderful, with Tiny.vc, another.vc and Venture Kick also participating. isospecanalytics.com

Private Equity Deals

Blackstone is exploring a potential sale of the owner of Motel 6, per Bloomberg. axios.link/4aAKZwK

Birch Hill Equity Partners is seeking to sell CCM, a Canadian hockey equipment company, per the Globe and Mail. axios.link/3QrIYLt

Bain Capital has agreed to sell Zellis Group, a U.K.-based payroll software company, to Apax Partners at a £1.25b ($1.56b) valuation, per Bloomberg. Apax is partly funding the deal with a unitranche loan of £450m from private credit funds. axios.link/43ZUCT3

Delmas Investissements & Participations agreed to acquire Acces Industrie, a French mobile aerial work platform and handling equipment rental company, from Equistone Partners Europe. acces-industrie.com

InvestorFlow acquired Coyote Software, a U.K.-based software provider for commercial real estate firms. coyotesoftware.co.uk

Wind Point Partners sold Handgards, an El Paso, Texas-based manufacturer and supplier of disposable food safety products for the food service industry, to Wynnchurch Capital. handgards.com

Public Offerings

Ibotta, a Denver-based online rewards company, now plans to raise $525m by offering 6.6m shares (62% secondary) at a price range of $76 to $84. At the midpoint, it will raise 17% more in proceeds than planned. It will still command a fully diluted market value of $2.9 billion. axios.link/3U2RFwJ

Marex Group, a U.K. commodities broker and trading services firm, plans to raise $300m by offering 15.4m shares (75% secondary) priced between $18 and $21. At the midpoint it would have a fully diluted market value of $1.4m. It plans to list on the Nasdaq as MRX. Barclays, Goldman Sachs, Jefferies, Keefe Bruyette Woods, Citi, UBS Investment Bank, Piper Sandler, and HSBC are the joint bookrunners on the deal. axios.link/3Jh3SZE

Rubrik, a Palo Alto, Calif.-based cybersecurity startup, plans to raise $679m by offering 23m shares at a price range of $28 to $31. At the midpoint, it would have a fully diluted market value of $5.2b. axios.link/3vUUVlC

Liquidity Events

APi Group (NYSE: APG) agreed to acquire, Elevated Facility Services, a Tampa, Fla.-based elevator and escalator maintenance, repair, and modernization company backed by L Squared Capital Partners. elevatedfacilityservices.com

More M&A

Public has acquired Stocktwits' brokerage accounts for less than $10m, per Axios Pro. axios.link/43YUmni

Fundraising

I didn't get the final sub-fund breakdown details for a16z's new funds in time for yesterday's newsletter, but here it is — note it's slightly different from the initial targets:

  • Growth fund: $3.75b
  • AI infrastructure: $1.25b
  • AI apps: $1b
  • American Dynamism: $600m
  • Gaming II: $600m

Citation Capital, a Dallas-based PE firm, is seeking about $850m for its debut fund, per Bloomberg. axios.link/4az0NQI

Infinity Ventures, a Palo Alto, Calif-based fintech venture firm, is raising $150m for its second fund, per an SEC filing.

🚑 Regeneron, a Tarrytown, N.Y.-based drug maker, committed up to $500m over the next five years to a new venture arm. axios.link/3VZAb6I

🌎 SOSV, a Princeton-based multi-stage deep tech venture firm, raised $306m for its fifth and largest fund. axios.link/3JmteFk

It's Personnel

Paul Tam and Peter Greenwood have left Greenhill, joining Houlihan Lokey as a managing director and Asante Capital Group as vice president, respectively. greenhill.com

Final Numbers

Data: FactSet; Chart: Axios Visuals
Data: FactSet; Chart: Axios Visuals

Former President Trump's meme stock fell on Monday, just like it has fallen on most of the 14 days it has traded on the Nasdaq stock exchange. It closed at $26.61 per share, down 18% from Friday's close and down 66% from its March 26 high of $79.38.

Why it matters: Trump's shareholding in Trump Media and Technology Group accounts for most of his net worth, notes my colleague Felix Salmon.

The intrigue: The latest drop came after the social-media company released a 217-page SEC filing designed to officially register millions of shares that belong to Donald Trump and other shareholders. Those shares aren't yet being traded on the Nasdaq, and they can't do so until the SEC deems the filing effective.

  • The filing and the associated press release do mention — eventually — that Trump Media and Technology Group isn't issuing new shares and won't receive any money when the newly-registered stock starts trading.

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