Been a tough week. And that Epstein dog hasn’t even barked yet. Anyway, let’s not dwell on the ‘what ifs’, let’s focus on more positive action. In particular, activity in the M&A and funding worlds, which should be taken as generally upbeat pulse-takes for individual investors. These deals also reflect the key structural drivers for the rapidly changing global economy. Change, you say? Well, Germany has had an engineering/capital goods trade surplus with China for decades. Not anymore. China in 2025 is now running a surplus with Germany. Oh, and nobody in the Oval Office will tell the Donald…. but “America First” has caused US equities to underperform overseas equities for only the third time in a decade. I know, whoodathunk amid all the giddy AI headlines? Interestingly, the deals I’m seeing in recent days also have a non-US focus.
Infrastructure is still a huge magnet for investment capital. Blackrock’s Global Infrastructure Partners vehicle has swooped in Spain to acquire the Digital & Energy unit of domestic construction giant, ACS. Yep, that’s a data centre and AI play with a whopping $27 billion price tag. Sticking with AI, and back in the US, Mira Murati’s Thinking Machine Labs is currently doing a funding round with valuation in the $50 billion region. In its last funding round in July (checks notes, yes) that valuation was $12 billion. Not to be outdone, Elon Musk’s xAI is raising $15 billion at a $200 billion valuation. So, I think we can safely say AI and the US are still leading the giddy stuff. Elsewhere, the deals are more fundamental. Try energy.
Private equity monster, Carlyle, is exploring an acquisition of Russian oil giant Lukoil’s global assets valued at almost $22 billion. Meanwhile, Spain’s energy champion, Repsol, is considering a reverse merger of its $19 billion upstream unit with potential partners including US energy producer APA. In addition, Google has signed a deal with French oil giant, TotalEnergies, to buy 1.5 terawatt hours (TWh) of solar electricity over the next 15 years in Ohio. That’s enough power to run the entire state of California for 10 days. Again, data centres are the key driver for the energy land-grab, be it fossil-fuel or renewable. However, as Spark closes out a lightning-quick raise of €1.5m for the impressive AuriGen Medical team, we should not forget demographics and the hugely significant structural growth in healthcare opportunities(check out our May 2025 series of articles on Japan).
Pfizer has acquired weight-loss start-up, Metsera, in a $10 billion all-cash deal. Then the rebuffed original buyer of Metsera, Novo Nordisk, went to the debt markets to finance the $5.2 billion purchase of US biotech Akero Therapeutics. The sense of a deal ‘cluster’ in pharma-land was further heightened by Merck’s likely acquisition of another biotech, Cidara Therapeutics, in a $3.3 billion deal. Like the Metsera deal, the bidding war for Cidara was intense too. So, things are looking pretty healthy in health M&A. As for the unhealthy world…. we continue to watch ‘Whiskey Pete’ deploy US Navy assets off Venezuela.
If ever there was a classic ‘wag the dog’ distraction mission this might be the one. Particularly, given both Jeffrey Epstein and Ghislaine Maxwell in emails from 2011, sound mystified about the “dog (Trump) that hasn’t barked” in the criminal investigation under way at that time. Venezuela is yet another prompt for all sovereign nations and the investment world to be thinking defence. Some aren’t just thinking. Valor Equity Partners have led a chunky $510m funding round for a counter-drone radar start-up, Chaos Industries, at a $4.5 billion valuation. Also, watch out for Germany’s Quantum Systems which manufactures interceptor drones which can climb 4 kilometres in 30 seconds(!). Last heard on the street, they were raising $150m at a $3 billion valuation.
All of the above sectors, bar health, position power sources and storage as key elements in competitive advantage. Note infrastructure and power are closely linked. The best positioned infrastructure assets will be those which bring energy/cost efficiencies in a world where AI is gobbling up more and more electricity, possibly at the expense of everyday consumers and traditional businesses. There is a reason why 40% of e-commerce deliveries in Europe are now done in out-of-home (OOH) parcel lockers. It makes sense for both the primary carriers (DHL,UPS, FedEx etc) and the consumer to make ‘the last mile’ more efficient. At Spark Private, we also think OOHPod makes a load of sense with lots of exit opportunities (and founder exit track-record) and great infrastructure positioning. In all of the above deals, everyone is trying to take the lead in positioning in the market. It can feel good too when it’s good for the world. In fact, I can still remember seeing a much-loved guy on his cool new electric bike just 5 years ago, and thinking to myself how happy he looked. I will keep that thought always…..
W.H. RIP.
