WEBVTT - Facebook in the Spotlight 0:00:01.800 --> 0:00:04.440 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:04.480 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanovk. We're here every day bringing 0:00:07.320 --> 0:00:09.840 you the latest news from the world to business and finance, 0:00:09.840 --> 0:00:13.640 plus technology, politics, economics, all partnising the power of Business 0:00:13.680 --> 0:00:17.160 Week reporters and editors, not to mention our journalists and 0:00:17.160 --> 0:00:20.000 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.239 Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.440 --> 0:00:25.200 You can also listen to our radio show at two 0:00:25.200 --> 0:00:27.880 pm Eastern Time on Bloomberg Radio or watch us on 0:00:27.920 --> 0:00:35.440 YouTube search Bloomberg Global News. Among the COVID headlines, Maderna 0:00:35.479 --> 0:00:37.760 saying it's COVID night teen vaccine showed a strong immune 0:00:37.760 --> 0:00:41.159 response in younger children in a late stage clinical tribal 0:00:41.240 --> 0:00:44.000 So that's paving really the way for submission to regulators 0:00:44.080 --> 0:00:47.360 for clearance in those age six to under twelve. That's something, Timmy, 0:00:47.320 --> 0:00:50.120 you've really been focusing on. Yeah, I certainly haven't even 0:00:50.520 --> 0:00:52.880 kids who are younger than that, that's the question. Also, 0:00:52.920 --> 0:00:55.400 some more good news, US COVID hospitalizations dropped to the 0:00:55.400 --> 0:00:59.520 lowest since July one, which is some great news considering 0:00:59.560 --> 0:01:02.120 where we were for much of the September month, September 0:01:02.120 --> 0:01:03.320 and the early part of this month. It's a good 0:01:03.320 --> 0:01:05.399 trend line that we like to hear about. Dr William 0:01:05.400 --> 0:01:07.600 Hazeltine is back with us. Cherman and president of Access 0:01:07.640 --> 0:01:10.760 Health International. It's a nonprofit think tank uh They are 0:01:10.840 --> 0:01:12.920 on a mission to improve access to high quality and 0:01:12.959 --> 0:01:15.720 affordable health care for people everywhere. He has found in 0:01:15.760 --> 0:01:19.400 more than a dozen biotech companies, including Human Genome Sciences. 0:01:19.480 --> 0:01:23.520 He is an author uh CV PTSD, COVID related post 0:01:23.560 --> 0:01:25.800 traumatic stress disorder, What it is and what to do 0:01:25.920 --> 0:01:29.479 about it? And many more articles and books. He joins 0:01:29.560 --> 0:01:32.120 us once again on the phone from Connecticut. Doctor how Hazeltine, 0:01:32.680 --> 0:01:36.240 Nice to have you back with us. Um Among the 0:01:36.280 --> 0:01:38.720 COVID headlines that are out there in terms of working 0:01:38.760 --> 0:01:43.360 towards getting kids vaccinated, the mix and match the trend lined, 0:01:44.000 --> 0:01:48.400 what is it that you think is of most importance? Well, 0:01:48.440 --> 0:01:51.000 the most important it is for people to be vaccinated, 0:01:51.600 --> 0:01:54.080 and the second most important is to make sure that 0:01:54.480 --> 0:01:56.200 if you're in a region where you think you might 0:01:56.240 --> 0:01:59.040 get infected, to make sure you take all precautions. That 0:01:59.120 --> 0:02:02.880 means mass ware, and I means avoiding crowds. So there 0:02:02.880 --> 0:02:06.520 are stale parts of the US where that's important and uh, 0:02:06.640 --> 0:02:10.200 it's important to follow those uh bad advice. And if 0:02:10.240 --> 0:02:14.240 you have had two shots and it's more than six months, 0:02:14.240 --> 0:02:19.160 it's probably time to get to third. Everybody, everybody, did 0:02:19.160 --> 0:02:22.680 you get your third? I certainly did. Okay, I remember 0:02:22.720 --> 0:02:25.840 you months ago saying I'm going to mark my calendar 0:02:25.880 --> 0:02:27.799 when it's six months, I'm going for I'm just doing 0:02:27.840 --> 0:02:29.760 some math on my fingers right now. Think I'm that 0:02:29.880 --> 0:02:32.639 six months, five months. But I jumped a gun a 0:02:32.680 --> 0:02:36.399 little bit. But you're right, and I'm very happy I did. Hey, 0:02:36.480 --> 0:02:39.080 Dr Hazel teen, Uh since we last spoke, since you 0:02:39.120 --> 0:02:41.639 were last on our show, there there has been a 0:02:41.639 --> 0:02:44.280 lot of developments, not just with COVID but for treatments 0:02:44.400 --> 0:02:46.600 as well. We did learn that Murk is looking for 0:02:46.639 --> 0:02:50.360 emergency use authorization for its COVID nineteen pill, and you 0:02:50.440 --> 0:02:53.720 wrote earlier this month that there are concerns around that 0:02:53.760 --> 0:02:56.000 approval process. Share with us you're thinking, because I think 0:02:56.000 --> 0:02:58.400 to a lot of people this was seen as really 0:02:58.400 --> 0:03:02.399 great news. Well, it's great news that drugs are coming 0:03:02.400 --> 0:03:05.000 along in there are three or four, actually about five 0:03:05.040 --> 0:03:09.280 in clinical development um. This drug will never up here 0:03:10.000 --> 0:03:12.000 is an interesting drug. By the way it works, it 0:03:12.040 --> 0:03:14.840 works differently from all others. It causes the virus to 0:03:14.960 --> 0:03:19.800 mutate itself to death. Mutate itself to death. Now there 0:03:19.840 --> 0:03:23.639 are several concerns. The number one concern is will you 0:03:24.160 --> 0:03:28.960 mutate sorryscope to something worse than it is. That is 0:03:29.000 --> 0:03:33.080 a real danger, and it exceeds all other dangers of 0:03:33.120 --> 0:03:37.520 the kind of resistance or side effects that might arise, 0:03:38.000 --> 0:03:40.280 because if you make a virus worse than it is, 0:03:40.400 --> 0:03:43.880 it affects all of humanity. This riers is bad enough. 0:03:44.600 --> 0:03:47.520 We don't want somebody taking a small dose by accident 0:03:47.520 --> 0:03:50.520 of the drug and mutating it so it doesn't die, 0:03:50.560 --> 0:03:53.480 but it just gets worse. So and he said, I don't. 0:03:53.520 --> 0:03:55.960 I think the FDA is going to be very, very 0:03:56.040 --> 0:04:00.440 cautious in their approval of this drug. Moreover, I spent 0:04:00.600 --> 0:04:05.080 years working on DNA damage at its repair and muta genesis. 0:04:05.480 --> 0:04:10.600 This is a genotoxic drug which causes mutations in human 0:04:10.680 --> 0:04:14.840 genes and could cause birth effects. And one of the 0:04:14.920 --> 0:04:20.000 interesting things about the clinical trials is they told people 0:04:20.040 --> 0:04:22.920 who are in the clinical trial either not to have 0:04:23.000 --> 0:04:26.320 sex or only do it with very strong birth controls 0:04:26.360 --> 0:04:28.520 because they were worried about that. So I think the 0:04:28.600 --> 0:04:31.560 FDA might approved this, but it's got to be for 0:04:31.600 --> 0:04:36.599 a very narrow indication. For me, The danger is people saying, Oh, 0:04:36.640 --> 0:04:38.760 I'm going to take this drug to prevent me from 0:04:38.760 --> 0:04:42.640 getting infected. The FDA has to put a very clear 0:04:42.760 --> 0:04:47.120 message out that only those people with proven infection should 0:04:47.160 --> 0:04:50.040 take this drug and then for as shorter period as possible. 0:04:50.360 --> 0:04:53.400 Both their dangerous to themselves and the danger that they 0:04:53.480 --> 0:04:55.920 might create the worst virus. We don't want to have 0:04:56.000 --> 0:05:00.279 to have another biox. It sounds to me like it 0:05:00.400 --> 0:05:04.839 might be for such narrow indications that it makes me wonder, 0:05:05.000 --> 0:05:08.000 do the risks that way, at least in your perspective, 0:05:08.040 --> 0:05:11.240 the risks that way um the benefits? You know. I 0:05:11.320 --> 0:05:13.440 haven't seen all the data, and the FDA will see 0:05:13.440 --> 0:05:15.960 all the data. All I can say, from what I know, 0:05:16.200 --> 0:05:20.000 from what I've seen, and from reading the clinical protocols, 0:05:20.160 --> 0:05:24.680 that I would urge the FDA to be extraordinarily cautious 0:05:25.240 --> 0:05:30.320 with respect to their approval, and possibly to put a 0:05:30.360 --> 0:05:34.400 black box on the approval process, saying this can be 0:05:34.560 --> 0:05:39.080 harmful to women who are pregnant, It can have a 0:05:39.080 --> 0:05:43.279 long term carcinogenic that's cancer causing effect. If you take it, 0:05:43.760 --> 0:05:46.159 and if you need to take it because it's the 0:05:46.200 --> 0:05:49.440 only thing available, fine, But you know, the other thing 0:05:49.440 --> 0:05:52.440 I'm aware of is your companies all over the world 0:05:52.480 --> 0:05:55.880 making tons of this drug, and the moment we get 0:05:55.880 --> 0:05:59.159 a partial approval from the FDA, I think this drug 0:05:59.279 --> 0:06:01.640 is going to go on and say out it's pretty 0:06:01.720 --> 0:06:04.640 much unregulated way around the world, and that could be 0:06:04.800 --> 0:06:08.960 very bad news for the creation of new variants. This 0:06:09.120 --> 0:06:15.520 drug works by speeding up commutation rate. That's dangerous. Well, 0:06:15.560 --> 0:06:17.240 and I will say all right through. I think it 0:06:17.279 --> 0:06:19.919 was in earlier. This month's ad interim analysis found now 0:06:19.960 --> 0:06:23.200 increased incidents of adversive fence, but they said it still 0:06:23.240 --> 0:06:24.760 needs to be assessed in a much larger group of 0:06:24.760 --> 0:06:27.320 patients to properly determine its safety. So it does sound 0:06:27.320 --> 0:06:31.360 like something that many would argue needs more research and study. 0:06:31.720 --> 0:06:34.279 Dr William Hasseltine, thank you so much, Chairman and President 0:06:34.279 --> 0:06:37.240 of Access Health International, joining us on the phone from Connecticut. 0:06:37.760 --> 0:06:39.599 You know, Tim, we talked about everything is happening in 0:06:39.600 --> 0:06:41.360 front of us, so it's just going to say that, right, 0:06:41.400 --> 0:06:44.359 some of it can be disarming, but you would assume 0:06:44.400 --> 0:06:46.560 regulators will continue to study. We're watching the process play 0:06:46.560 --> 0:06:48.760 out in front of us exactly. You're listening to Bloomberg 0:06:48.760 --> 0:06:52.039 Business Week right here on Bloomberg. I love it when 0:06:52.120 --> 0:06:54.000 the most read stories by one of the good guys 0:06:54.040 --> 0:06:56.520 here at Bloomberg. We're talking about our own Eric Shatzker, 0:06:56.600 --> 0:06:59.240 He's a Bloomberg editor at large, and this story is 0:06:59.480 --> 0:07:01.159 we just can't stop talking about. It has to do 0:07:01.160 --> 0:07:03.600 with Hurts's order for a hundred thousand e v s. 0:07:03.720 --> 0:07:06.200 It pushed Tesla shares higher and the company's market cap 0:07:06.200 --> 0:07:09.120 to one trillion. We're all talking about it. Eric Schatsker, 0:07:09.200 --> 0:07:10.560 is that are at large and he joins us now 0:07:10.600 --> 0:07:13.880 in the Bloomberg Interactive Broker Studio, Eric one hundred thousand. 0:07:13.920 --> 0:07:17.280 Contextualize this number for US. A tenth of what Tesla produces, 0:07:17.280 --> 0:07:20.280 and yet it's equivalent to a tenth of Tesla's annual 0:07:20.320 --> 0:07:24.640 manufacturing capacity. And once these cars are delivered between now 0:07:24.680 --> 0:07:26.800 and the end of two thousand twenty two, it will 0:07:26.840 --> 0:07:31.120 be fully a fifth of Hurts is half million fleet 0:07:31.120 --> 0:07:34.600 of cars and trucks. That's massive, So putting the numbers 0:07:34.600 --> 0:07:37.200 are big for sure, right and and it up ends 0:07:37.240 --> 0:07:38.800 so many different parts of the market. If you think 0:07:38.800 --> 0:07:41.360 about the rental car companies used to really write their 0:07:41.360 --> 0:07:45.560 fleets are often from the traditional auto manufacturers. Were completely right, 0:07:45.600 --> 0:07:49.040 but entirely from the traditional auto manufacturers. General Motors is 0:07:49.080 --> 0:07:51.920 the biggest supplier, Nissan is the number two supplier to Hurts. 0:07:51.960 --> 0:07:55.520 Forward is the numbers three supplier. And furthermore, when these 0:07:55.520 --> 0:08:00.120 auto manufacturers were selling, they were typically selling cars that 0:08:00.160 --> 0:08:04.360 they weren't especially excited about making and often had sitting 0:08:04.560 --> 0:08:07.760 in the bookstore equivalent of a remainder lot. So the 0:08:08.240 --> 0:08:10.280 you know, the rental car companies would buy them at 0:08:10.360 --> 0:08:15.320 massively discounted prices. There was a naturally an antagonistic relationship 0:08:15.360 --> 0:08:18.240 between the rental car company and the automaker, and this 0:08:18.360 --> 0:08:22.120 completely changes that equation because Hurts is buying these cars 0:08:22.560 --> 0:08:26.160 at close to list price, which brings the two companies 0:08:26.240 --> 0:08:29.640 much closer together, something akin to a partnership as opposed 0:08:29.640 --> 0:08:34.880 to an adversarial relationship. Help us understand some logistics here, Eric, 0:08:34.960 --> 0:08:38.720 Because you have to charge these you do, and you 0:08:38.720 --> 0:08:41.000 have to think about rental cars, you gotta fill it 0:08:41.040 --> 0:08:42.560 up before you go back, or else you get you 0:08:42.600 --> 0:08:46.320 get digged um, how does the charging network work? And 0:08:46.360 --> 0:08:48.800 how does how does Hurts ensure someone that they're gonna 0:08:48.800 --> 0:08:52.520 be able to reliably charge it? Well? For starters, Hurts 0:08:52.640 --> 0:08:57.439 customers who rent Tesla's will have access to Tesla's network 0:08:57.480 --> 0:09:00.520 of three thousand supercharging stations. So that helps a great 0:09:00.559 --> 0:09:03.360 deal because that's already made it possible for people to 0:09:03.400 --> 0:09:07.200 own Tesla's and to find an acceptable, viable substitute for 0:09:07.200 --> 0:09:09.800 the gas station. But Hurts is building its own network 0:09:09.800 --> 0:09:12.560 of chargers, and they'll be at Hurts locations, whether they 0:09:12.559 --> 0:09:15.600 be at the airport or somewhere in suburbia or even 0:09:15.960 --> 0:09:18.440 you know, downtown in an urban center like a New 0:09:18.520 --> 0:09:21.760 York City for example, And so Hurts customers will be 0:09:21.840 --> 0:09:25.920 able to use those as well. Furthermore, did I say 0:09:25.920 --> 0:09:31.240 furthermore twice? Maybe there's a lot furthermore moreover? How's that um? 0:09:31.400 --> 0:09:38.160 Hurts is going to integrate Tesla's digital mobility technology with 0:09:38.240 --> 0:09:42.040 its own digital mobility technology in order to help customers 0:09:42.080 --> 0:09:45.200 get over the fear of range anxiety. The car will 0:09:45.240 --> 0:09:47.520 tell you what you have to do, as long as 0:09:47.559 --> 0:09:49.880 you tell the car where you're going. The car will 0:09:49.880 --> 0:09:51.920 tell you how much you've got left. If you where 0:09:51.920 --> 0:09:54.240 the supercharging station is that you need to drop by 0:09:54.320 --> 0:09:58.120 for fifteen minutes to make sure that nobody has that 0:09:58.280 --> 0:10:00.680 crushing experience will being left down in the middle of 0:10:00.679 --> 0:10:05.160 the Mojave desert with no feel Furthermore, which is something 0:10:05.200 --> 0:10:07.439 you do want. No But I think about this story 0:10:07.559 --> 0:10:11.400 about the legitimization of Tesla and the legitimization of Hurts 0:10:11.440 --> 0:10:13.960 like thinking about what they want to be in the future. Well, 0:10:14.000 --> 0:10:17.040 for sure, this gives you an idea that Tesla has 0:10:17.400 --> 0:10:21.120 big plans to become an even bigger evy manufacturer than 0:10:21.160 --> 0:10:23.960 it already is. It's the only company that can manufacture 0:10:24.000 --> 0:10:26.640 e vis at scale. And this is proof positive that 0:10:26.679 --> 0:10:30.440 Elon Musk had not just a vision, but a viable 0:10:30.559 --> 0:10:33.960 vision because Hurts can't buy from anybody else. And on 0:10:34.000 --> 0:10:39.640 the Hurt side, I think this shows you just how disrupted, 0:10:39.679 --> 0:10:42.760 if you like, an industry can be by people who 0:10:42.800 --> 0:10:46.240 come in from the outside. Nighthead Capital the distress that 0:10:46.320 --> 0:10:48.839 Hedge Fund and Sertari is the private equity firm that 0:10:48.920 --> 0:10:51.560 specializes in travel, teamed up to buy Hurts out of 0:10:51.559 --> 0:10:54.560 bankruptcy for six billion dollars or that looks like a 0:10:54.600 --> 0:10:57.200 good deal. Now. But they're the ones who came up 0:10:57.240 --> 0:11:00.520 with the ideas to do this, and I'm really excited 0:11:00.559 --> 0:11:03.760 to see what else they do, because they're clearly intent 0:11:03.880 --> 0:11:08.000 on shaking up the rental car industry, which is a competitive, 0:11:08.080 --> 0:11:11.839 highly commoditized industry and isn't really used to being shaken up. 0:11:11.920 --> 0:11:15.160 Hurts his twelve point six billion market cap as we speak. Wow, 0:11:15.400 --> 0:11:17.360 I know, right, so not too shavvy. I wonder when 0:11:17.360 --> 0:11:19.080 we look back on the history just in a couple 0:11:19.080 --> 0:11:21.080 of years of Tesla, if this is one of those moments. 0:11:21.080 --> 0:11:22.760 And we talked to Dana Hole about this, who covers 0:11:22.760 --> 0:11:25.720 Tesla Bloomberg News. It's still you know, when you see 0:11:25.720 --> 0:11:27.320 a Tesla out in the wild, you're still like, oh, 0:11:27.360 --> 0:11:29.480 there's a Tesla, but there's a lot more on the road. 0:11:30.440 --> 0:11:33.880 And yeah, in California, it's not really a thing anymore. 0:11:34.120 --> 0:11:37.280 But does this get countrywide, Like, Okay, seeing a Tesla out, 0:11:37.320 --> 0:11:39.640 We're going to see a whole lot more Tesla's and 0:11:39.679 --> 0:11:42.120 it won't be a big deal anymore. Well, this is 0:11:42.160 --> 0:11:44.679 ten percent of the annual manufacturing capacity of Tesla. But 0:11:44.720 --> 0:11:47.640 Tesla is adding factories in Austin, It's adding a factory 0:11:47.679 --> 0:11:49.240 in Europe, and so we're going to see on the 0:11:49.240 --> 0:11:52.840 basis of that alone, added capacity and more Tesla's and 0:11:52.920 --> 0:11:56.560 let's not forget this is not an exclusive deal. Hurts 0:11:56.640 --> 0:11:58.720 if it wants to can go and buy evs from 0:11:58.760 --> 0:12:01.520 other manufacturers to just aren't any to buy right now. 0:12:01.520 --> 0:12:06.440 But Rivian's coming, Lucid's coming, all the big European producers, 0:12:06.480 --> 0:12:09.280 manufacturers are going to have their own. They're going to 0:12:09.320 --> 0:12:12.120 have their own here Ford, No, no, no, we should 0:12:12.120 --> 0:12:15.000 be talking about Detroit to of course, General Motors has 0:12:15.040 --> 0:12:18.880 a very viable, very viable EV strategy, but they're targeting 0:12:18.880 --> 0:12:21.200 different parts of the market. The Chevy Bolt is at 0:12:21.200 --> 0:12:23.720 the bottom, and Cadillac, where they're also doing some really 0:12:23.760 --> 0:12:26.720 exciting EV stuff, is at the top end, just like Lucid, 0:12:27.000 --> 0:12:29.960 and just like Rivan. There's nobody filling in the middle. 0:12:30.280 --> 0:12:33.720 Volkswagen is probably going to be a big manufacturer in 0:12:33.720 --> 0:12:36.680 the middle because that's what Volkswagen does. You could anticipate 0:12:36.720 --> 0:12:39.160 the Toyota at some point is going to do something similar, 0:12:39.200 --> 0:12:42.360 but they are years behind. And that's the thing worth 0:12:42.400 --> 0:12:47.199 emphasizing again. Muskat division need to manufacture at scale. Why 0:12:47.240 --> 0:12:49.560 do you need to manufacture at scale? Because then you 0:12:49.640 --> 0:12:52.079 become the only guy on the block who can do 0:12:52.120 --> 0:12:53.720 a deal like this, which is what is playing out 0:12:53.720 --> 0:12:56.520 to be. Continued. Eric Statsker, Editor at large up Bloomberg News. 0:12:56.600 --> 0:12:59.079 Check out his exclusive story on the Bloomberg I have 0:12:59.160 --> 0:13:01.640 to say, Tim, when I asked um our Ed Hammond 0:13:01.640 --> 0:13:03.880 about a week or so ago, when what I needed 0:13:03.880 --> 0:13:05.720 to talk about it my milk and panel and Global 0:13:06.040 --> 0:13:07.760 M and A. He said, well, record year, and how 0:13:07.800 --> 0:13:11.520 is that considering the backdrop? It was incredible advice. Yeah. 0:13:11.640 --> 0:13:13.360 One thing that stuck out to me from this piece, 0:13:13.400 --> 0:13:15.360 and Ed Hammond is deals reporter at Bloomberg News, he 0:13:15.400 --> 0:13:17.920 joins us now here in New York City, and one 0:13:17.920 --> 0:13:19.400 thing that really stuck out to me was something in 0:13:19.400 --> 0:13:22.760 the first paragraph. The records set in two thousand seven. 0:13:22.800 --> 0:13:24.920 So let's talk numbers here. Four point one trillion this 0:13:25.280 --> 0:13:27.280 year would break the record set in two thousand seven 0:13:27.280 --> 0:13:29.840 for Global, for M and A by the end of 0:13:30.559 --> 0:13:33.640 transactions to usually top five trillion dollars. Is this some 0:13:33.679 --> 0:13:36.400 sort of sign when when there's M and A like this, 0:13:36.440 --> 0:13:41.040 because we all know what happened after two thousand seven. Um, 0:13:41.080 --> 0:13:43.880 I'm sort of hesitant to draw parallels between oh, seven, 0:13:43.920 --> 0:13:45.360 and now in terms of using the M and A 0:13:45.400 --> 0:13:48.200 market is a reason to suggest that the wieldy are 0:13:48.200 --> 0:13:50.680 about to come out flok. Obviously, we are long into 0:13:50.679 --> 0:13:53.640 a market cycle that has you know, had the top 0:13:53.720 --> 0:13:57.680 called many times. I was among those who thought M 0:13:57.679 --> 0:14:00.640 and A would probably haven't pronounced and a long time 0:14:00.720 --> 0:14:02.880 slow down after the pandemic or when we go into 0:14:02.880 --> 0:14:04.960 the pandemic, and as it turned out, it was you know, 0:14:05.240 --> 0:14:08.280 one and a half quarters that it kind of stopped 0:14:08.280 --> 0:14:10.400 for or slowed down for, and then it's roared back. 0:14:10.480 --> 0:14:12.240 We saw it come back very strongly in the second 0:14:12.240 --> 0:14:17.199 half of that momentum continued so far throughout this year. 0:14:17.240 --> 0:14:19.560 And as you say you were about to pass the IS, 0:14:19.640 --> 0:14:21.240 I was in a seven record. We may indeed it 0:14:21.280 --> 0:14:24.760 passed it at some point today and well on track 0:14:24.840 --> 0:14:26.400 yet that quite trilling and by the end of the year, 0:14:26.440 --> 0:14:29.320 which an astonishing number, I mean in any circumstance, and 0:14:29.360 --> 0:14:32.160 astonishing number. But when you look at all the the 0:14:32.280 --> 0:14:34.800 environmental factors going on in the background, and why you 0:14:34.800 --> 0:14:37.360 wouldn't want to do a deal right now, I think 0:14:37.400 --> 0:14:39.720 you know also well and what's interesting at and you 0:14:39.760 --> 0:14:43.240 really did like set up me so well But what's 0:14:43.240 --> 0:14:45.960 interesting too is you know these dealmakers that I talked 0:14:46.000 --> 0:14:49.320 to bankers over the city, at Deutsa and elsewhere, they 0:14:49.360 --> 0:14:52.320 said that in many ways, UM members of the C 0:14:52.400 --> 0:14:54.040 suite are getting kind of poked and product by their 0:14:54.040 --> 0:14:56.240 board for not doing deals right now, talk to us 0:14:56.280 --> 0:14:58.720 about what you're hearing. Why these deals are getting done 0:14:59.040 --> 0:15:02.560 despite the backdrop of a pandemic and worries about the 0:15:02.600 --> 0:15:06.560 outlook and supply chain problems and so on. I think 0:15:06.600 --> 0:15:08.480 part of it is just the cost of a nursher 0:15:08.560 --> 0:15:11.440 is is also very high. Look obviously, doing a deal 0:15:11.480 --> 0:15:15.120 at any time carry some risk, and you know you 0:15:15.160 --> 0:15:17.160 can get it wrong and that can be consequential. As 0:15:17.200 --> 0:15:19.800 the CEO, you can do your borders or your job 0:15:19.840 --> 0:15:23.400 stories aboard, you can be tossed out. But I think 0:15:23.480 --> 0:15:26.240 right now, with the amount of disruption is going on 0:15:26.280 --> 0:15:28.920 across industries and the sort of rapidity of change that 0:15:28.960 --> 0:15:32.120 almost their industry is going through, I think there are 0:15:32.120 --> 0:15:35.720 a real cost to not doing stuff and not growing. 0:15:36.000 --> 0:15:39.120 And you know, at the moment a lot of companies 0:15:39.200 --> 0:15:42.000 are matched out on organic growth and M and A 0:15:42.040 --> 0:15:44.320 is obviously a very quick and efficient way a lot 0:15:44.360 --> 0:15:47.080 of the time to to to sort of turbo charge 0:15:47.080 --> 0:15:50.240 that growth in organically. In reporting this story, and you 0:15:50.240 --> 0:15:53.400 also looked at how investors react to companies that when 0:15:53.400 --> 0:15:55.640 a company does announce an acquisition, both to the company 0:15:55.640 --> 0:15:57.800 getting acquired and the one doing the acquiring. What did 0:15:57.840 --> 0:16:02.240 you learn. It's a really interesting trend that we've seen 0:16:02.240 --> 0:16:04.880 to him where you have this, uh, this sort of 0:16:04.880 --> 0:16:07.440 anomaly in the market where shareholders are coming out when 0:16:07.640 --> 0:16:09.920 companies and ounced deals and saying, you know, this is 0:16:09.960 --> 0:16:12.040 something we do like, and they're reflecting that in the 0:16:12.040 --> 0:16:15.400 way the shares trade obviously quisitive companies and seeing shares 0:16:15.440 --> 0:16:19.440 trade up, which goes against almost very historical trends per virus. 0:16:20.800 --> 0:16:23.200 The recent paper US interest deal that was talked about 0:16:23.280 --> 0:16:26.520 right before I came on, obviously that was slightly different 0:16:26.560 --> 0:16:29.720 where you saw papal trends down and trade down heavily 0:16:29.720 --> 0:16:32.520 on news and some extent we think that's why they've 0:16:32.640 --> 0:16:35.560 now pulled the plug on that particular deal. But yeah, 0:16:35.640 --> 0:16:38.960 investors again, look, they're they're happy to see companies going out, 0:16:39.000 --> 0:16:41.320 getting on the front foot and pulling whatever leavers they 0:16:41.320 --> 0:16:43.760 can to achieve growth in this market. And I think 0:16:43.760 --> 0:16:46.000 it all comes back to the fact that we are seeing, 0:16:46.520 --> 0:16:50.040 you know, not reckless deals. We're not seeing companies go 0:16:50.080 --> 0:16:53.560 out and try and do very very large, complex, you know, 0:16:54.360 --> 0:16:57.400 sort of horizontal mergers. This is much more vanilla. Let's 0:16:57.400 --> 0:16:59.200 go out, let's do a deal that actually is in 0:16:59.240 --> 0:17:01.239 line with what we ever we want to do strategically 0:17:01.560 --> 0:17:03.760 from perhaps it gets it slightly quicker from A to 0:17:03.880 --> 0:17:05.679 B than we would get their organic too. Well, how 0:17:05.760 --> 0:17:08.320 much of it, too, is pandemic related or pandemic push 0:17:08.480 --> 0:17:13.919 and where you know, trends, disruptions, digitization was happening, but 0:17:13.960 --> 0:17:15.640 it might have happened over the next three to five years, 0:17:15.680 --> 0:17:17.120 and all of a sudden it was like, Bam, it's 0:17:17.160 --> 0:17:21.000 happening now, and I've got to possibly do a deal 0:17:21.040 --> 0:17:24.080 and acquisition to put my business in the right place 0:17:24.200 --> 0:17:27.840 to embrace that. Yeah, And I think that that comes 0:17:27.840 --> 0:17:31.040 back to this issue of disruption and the speed at 0:17:31.040 --> 0:17:33.120 which it's occurring now. And as you say, the pandemic 0:17:33.160 --> 0:17:36.040 sort of supercharged some of the activity. But you look 0:17:36.080 --> 0:17:38.520 at any industry now and they are all you know, 0:17:38.560 --> 0:17:41.199 if they're not tech industries that take enabled industries and 0:17:41.240 --> 0:17:42.560 so a lot of them. We've seen a lot of 0:17:42.600 --> 0:17:45.640 this already this year, are going and doing acquisitions that 0:17:45.800 --> 0:17:48.720 don't necessarily look like a sort of straightforward. You know, 0:17:48.760 --> 0:17:51.880 an industrial company buying an industrial company. They're an industrial 0:17:51.880 --> 0:17:54.680 company buying a software company because they're realizing that actually, 0:17:54.720 --> 0:17:57.080 this is the way we're going to keep growing, and 0:17:57.080 --> 0:17:59.560 it's much easier to go out and buying something small 0:17:59.600 --> 0:18:01.960 that we can just tuck in then build our own 0:18:02.000 --> 0:18:04.399 capabilities in an area that perhaps is not where we 0:18:04.440 --> 0:18:08.600 have existent skills. How do spacts play into the boom 0:18:08.600 --> 0:18:11.760 that we've seen over the last eighteen months. Well, look 0:18:11.800 --> 0:18:14.479 in terms of the sort of headlines and the amount 0:18:14.480 --> 0:18:17.000 of noise and interest they command their normals, but in 0:18:17.080 --> 0:18:19.159 terms of the actually dollar value, they're very, very tiny. 0:18:19.880 --> 0:18:24.560 You know, certainly if you look at the sort of 0:18:24.560 --> 0:18:26.919 the dollar value of the spacts themselves rather than the 0:18:26.960 --> 0:18:29.159 dollar value of the companies, they often reverse into as 0:18:29.160 --> 0:18:32.400 a minority holder you're talking, you know, it's it's it's 0:18:32.440 --> 0:18:37.399 a minimus. But obviously trends they have been, you know, 0:18:37.480 --> 0:18:40.200 a driver of different kinds of activity. I'm sure you've 0:18:40.240 --> 0:18:41.879 seen some companies go out and do M and A 0:18:42.000 --> 0:18:44.760 because they were sort of worried about what might otherwise 0:18:44.800 --> 0:18:47.000 happened with the spect potentially buying a target that they 0:18:47.000 --> 0:18:50.800 were interested. So I think it's contributed, but certainly there 0:18:50.880 --> 0:18:54.240 is a quite serious dislocation between the amount of noise 0:18:54.280 --> 0:18:57.639 Spect have generated and the actual contribution they've had to 0:18:57.720 --> 0:19:00.240 overall EM and ads here. So all right, if we 0:19:00.320 --> 0:19:03.200 end up with five trillion and then some this year, 0:19:03.560 --> 0:19:06.000 does that mean things necessarily slow down? Because I know 0:19:06.080 --> 0:19:09.320 from my panel they all seem gangbusters that it would 0:19:09.320 --> 0:19:11.800 continue into two. But what are you hearing? I mean, 0:19:11.800 --> 0:19:14.440 money is so cheap it's easy for they've also got 0:19:14.480 --> 0:19:18.680 a lot of you know, cash to play around with. Yeah, look, 0:19:18.720 --> 0:19:22.240 money is cheap, and that's often site is one of 0:19:22.240 --> 0:19:24.200 the reasons we're seeing this this great market. What I 0:19:24.240 --> 0:19:25.840 would say to that is money has been cheap for 0:19:25.880 --> 0:19:29.679 a long time, and there have been fast going on 0:19:29.760 --> 0:19:32.080 that would would seem to dissuade people been doing M 0:19:32.080 --> 0:19:33.760 and A. So I don't think it just cheap money. 0:19:34.359 --> 0:19:37.000 I think there's a lot of momentum going through the 0:19:37.080 --> 0:19:38.760 M and A market at the moment. Some of that 0:19:38.840 --> 0:19:42.560 is obviously catch up after we had that slowdown during COVID, 0:19:43.200 --> 0:19:45.639 and I think some of that will continue into two. 0:19:45.720 --> 0:19:48.639 The conversations we've been having. We had a common tax 0:19:48.960 --> 0:19:51.000 m A ban Cool on Bluemo TV this morning talking 0:19:51.040 --> 0:19:54.560 about the strength of the pipeline. They actually think it's 0:19:54.600 --> 0:19:57.520 stronger than the current market conditions we're seeing, which would 0:19:57.520 --> 0:20:00.560 suggest going into two, we're going to have a you know, 0:20:00.600 --> 0:20:02.600 a lot of deals backed up ready to go. Whether 0:20:02.640 --> 0:20:07.560 it continues through two, sorry, who knows? Um. I think 0:20:07.560 --> 0:20:09.639 a lot of that will depend on on what we see, 0:20:09.800 --> 0:20:12.040 you know, in in sort of global affairs, what we 0:20:12.119 --> 0:20:14.960 see the domestic economy, but also obviously some of the 0:20:15.000 --> 0:20:19.080 sovereign risks that he just ten seconds, what derails this 0:20:19.320 --> 0:20:24.280 from continuing? The great question? Um, I would I thought 0:20:24.320 --> 0:20:27.359 COVID wouldn't It didn't I think? Look in rising interest 0:20:27.480 --> 0:20:29.280 rates is obviously gonna be the number one factors that 0:20:29.359 --> 0:20:32.480 will not business confidence and never m A all right, 0:20:32.520 --> 0:20:34.240 gonna leave it there. I get your sleep, because you're 0:20:34.240 --> 0:20:36.600