| Hey Insiders, Monday's edition of Inside Business takes a look at: - KPMG's $2B AI and cloud services investment
- Analysis of why drugmakers are rushing to develop weight loss medications
- Yellen warning of China's economic spillover
Plus, General Atlantic and Goldman have offered $1.7B for Kahoot. Make sure to keep reading and check out the Knowledge Hub and Quick Hits. If you find this newsletter helpful, please share it with your friends and colleagues. Shriram
p/Shriram | |
| 1 | | KPMG is set to allocate $2B toward AI and cloud services through an extended collaboration with Microsoft to automate parts of their tax, audit, and consulting services. This partnership is expected to generate over $12B in revenue for KPMG over the next five years while bolstering its workforce with AI expertise and creating new opportunities. More: - As part of the relationship, KPMG will receive early access to Microsoft 365 Copilot, an AI assistant.
- The investment will concentrate on generative AI with financial, ESG reporting, tax, and auditing applications.
- Along with Microsoft, other Big Four accounting firms have invested in cloud and AI technologies.
- KPMG has already committed to investing $5B in technology for five years, with a preceding $1B investment in Microsoft.
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| 2 | | 
What the numbers say: According to Morgan Stanley, by 2030, weight-loss medications might rank in the top 12 treatments globally, with a market value of $54B, up from $2.4B last year. Weight-loss drug developers have secured deals worth over $1.4B in the past year, per Piper Sandler analysts, suggesting significant market growth potential as only a few eligible individuals currently utilize prescription medications for weight loss. Relevance: The success of weight-loss medications such as Ozempic and Wegovy has led to a thriving pharmaceutical market. This has sparked investor enthusiasm, fueling the advancement of new treatments and diagnostic tools to improve the matching of patients with the most suitable weight-loss drugs. More Data: Eli Lilly has acquired Versanis Bio, a company specializing in an obesity pill, in a deal valued at up to $2B. With over 80 drugs developed for obesity and related conditions, researchers also explore obesity biomarkers to identify high-risk patients and improve the matching process for weight-loss medications. | | | |
| 3 | | U.S. Treasury Secretary Janet Yellen warned that China's economic slowdown could have significant negative impacts on the global economy and urged China to take steps to support its economy. Her concerns come at a time when the global economy is already facing headwinds from the war in Ukraine and rising inflation. More: - According to the National Bureau of Statistics of China, the country's economy grew at an annual rate of 0.4% in the first quarter of 2023, the slowest pace since the first quarter of 2020, when the COVID-19 pandemic first hit China.
- The International Monetary Fund has downgraded its forecast for China's economic growth this year to 4.4%, down from 4.8%.
- According to data from the China Index Academy, sales of new homes in China fell by 28.1% in the first half of 2023.
- According to the General Administration of Customs of China, China's exports fell by 3.2% in the first half of 2023, and imports fell by 1.7%.
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| 4 | | General Atlantic and Goldman Sachs Asset Management led a group that made a $1.7B cash offer (17.2B kroner) for the Norwegian educational technology business Kahoot! ASA. The offer of 35 kroner per share is 33% higher than the three-month average share price and 12% over Thursday's closing price. More: - As more schools moved their schoolwork online during the COVID-19 lockdowns, Kahoot saw a spike in revenue. It also grew by acquiring Clever and DragonBox.
- In Friday's trading in Oslo, the company's shares increased 11% on Friday; year-to-date, the stock has increased 61%.
- General Atlantic has been looking for ways to have more control over Kahoot. It is already the biggest shareholder.
- The Kahoot board unanimously endorsed the offer, and around 34% of the company's existing shares have already been purchased by investors.
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| 5 | | Mortgage rates have declined, but affordability remains a challenge because the gap between them and the 10-year Treasury yield remains wide. As a result, homebuyers are still facing high monthly payments, and Fannie Mae predicts that rates will remain near current levels through 2023. More: - Historically, the spread between mortgage rates and the 10-year treasury rate has been around 200 basis points, but currently, the spread is around 400 basis points.
- The 10-year Treasury yield (currently at 3.83%) fell on lower inflation numbers last week, touching 3.76% after reaching 4.09% earlier in July.
- Mortgage rates also dropped to 6.89% last Friday from a recent peak of 7.22%, according to Mortgage News Daily.
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| 6 | | Anchor Brewing Company may yet survive after announcing last Wednesday that it would end operations and liquidate the business. A group of preservationists is trying to raise money to buy the brewery and keep it open. More: - This is a follow-up to the story published in our July 13 issue.
- The brewery, located in San Francisco's Potrero Hill neighborhood, is one of the oldest operating breweries in the U.S.
- The brewery's landlord, GreenStreet Properties, is considering selling the property for $20M.
- The local preservationists, called "Save Anchor Steam," have raised over $1M to date to buy the brewery.
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| 7 | | Quick Hits: - It's true: there really is a once-in-a-lifetime IRS kickback available to 80% of businesses. Apply Now.*
- Ford has announced price reductions of at least $6,000 for all models of its electric F-150 Lightning pickup, with the least expensive model now starting at roughly $50,000, in an effort to boost manufacturing.
- AmeriCorps announced it recovered a record $84M in unclaimed tax benefits for low-income individuals during the 2023 tax season.
- One of the most expensive MLS ticket prices ever is being charged for tickets to Lionel Messi's projected U.S. debut for Inter Miami, which are going for up to $110,000 on the ticket reselling website Vivid Seats.
- Next week, Wall Street will issue bonds and loans totaling $1.9B to finance Apollo's acquisition of Arconic, capitalizing on the current rise in the leveraged finance markets driven by high demand and limited supply.
- Level up your AWS knowledge. Packed with tips and tricks, the Amazon Web Services Cookbook is a must-have resource for both novices and experts.*
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Term of the Day Brand identity: Brand identity is the visual representation of a company or product, including the company logo, colors, typography, and images used. Question of the Week Do you think it's ever acceptable to bring politics into the workplace? Join the conversation |
INSIDE BUSINESS LEADERBOARD (7 DAYS) |
 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Aaron Crutchfield | |
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