Happy Wednesday and welcome to your morning wrap of the latest business and political news from around the world.
We begin with yet another development in the battle to own Warner Bros Discovery (WBD).
The Financial Times is reporting that WBD has reopened talks with Paramount Skydance, giving the media group seven days to make its “best and final” bid to top Netflix’s US$83b ($137b) offer for its film studios and content library.
Netflix has granted WBD a week-long waiver to hold discussions with Paramount to “fully and finally resolve this matter”.
The move is an attempt to force Paramount to either improve or abandon its pursuit of the company following multiple rejections since October.
A person close to the deal told the FT the situation was a “put up or shut up” moment for Paramount, which launched a hostile takeover bid for the company last year.
WBD chief executive David Zaslav, in a statement, said the company would hold talks for a week to determine whether Paramount could address the “deficiencies” in its offer and present a binding offer that delivered superior value.
Last week, WBD turned down Paramount's sweetened bid for the company, which offered shareholders extra cash for each quarter the deal didn't close, and also agreed to cover a break-up fee with Netflix if it walked away. However, it did not raise its underlying offer of US$30 per share, or US$108.4b including debt, for the whole company.
WBD investors have signalled they would expect at least $33 a share to entertain a competing bid to Netflix’s.
The Last of Us is an HBO Max production, which is owned by Warner Bros Discovery.
Moving to Switzerland, where a second round of talks between Iran and the United States, aimed at resolving their dispute over Tehran’s nuclear programme, has wrapped up, the BBC reported.
Iran’s Foreign Minister Abbas Araghchi said the two countries had reached an understanding on the main “guiding principles, but work still needs to be done”. The US has not yet commented.
The discussions followed military threats by Washington against Iran over its deadly crackdown on anti-government protests, which are estimated to have resulted in the deaths of thousands, as well as nuclear activities.
Earlier, Iran temporarily closed off the Strait of Hormuz to conduct military drills ahead of the talks in Geneva, the Associated Press reported.
It was the first time Tehran has closed the key international waterway, through which 20% of the world’s oil passes, since the US threats against Iran. Iran’s state media announced that forces had fired live missiles towards the strait and would close it for several hours for “safety and maritime concerns”.
On Wall Street, the main indices were little changed at the start of the shortened week.
As CNBC reported, beaten-down software names added to the losses they’ve seen this year, as investors rotated out of those stocks and into financials.
The software sector has been hard-hit in recent weeks on fears that advances in artificial intelligence could replace industry-specific software providers.
Concurrent Investment Advisors chief investment strategist Leah Bennett told CNBC that time was needed to assess the impact on software companies’ earnings. “I think those that aren’t able to compete and don’t really have moats around their business, you’re going to see a deterioration.”
Brent crude oil was down more than 2% after talks between Iran and the US ended, while gold was down another 3% to US$4878 an ounce, and bitcoin eased 1.7% to US$67,069.
In other markets, the British pound and government bond yields fell after labour market data showed unemployment rose to a five-year high while wage growth slowed.
As reported by The Guardian, the unemployment rate rose to 5.2% in the three months ended December, up from 5.1% in the three months ended November. The increase was in line with economists’ expectations.
Wages, excluding bonuses, increased by 4.2% compared with 4.4% in the prior period. Once adjusted for inflation, pay excluding bonuses rose by just 0.8% in October to December – the lowest rate since August 2023.
Institute of Chartered Accountants in England and Wales economics director Suren Thiru said the situation was unlikely to improve.
Jesse Jackson in 2024. (Source: Wikimedia Commons.)
“This slackening in pay growth is likely to gather momentum in the coming months as the downward pressure from mounting lay-offs and higher employment costs increasingly weakens workers’ bargaining position.”
Finally this morning, US civil rights leader Jesse Jackson has died at the age of 84, his family announced in a statement reported by the BBC.
"Our father was a servant leader – not only to our family, but to the oppressed, the voiceless, and the overlooked,” it said.
Jackson fought for civil rights alongside Martin Luther King Jr in the 1960s and helped lead countless other movements. He was one of the most recognisable figures in US politics.
Tributes have poured in for Jackson, with US President Donald Trump saying he was a "force of nature like few others before him". He added that it was his pleasure to "help Jesse along the way".
Former US president Barack Obama said he and his wife, Michelle, were saddened to hear of his death and would be “always grateful for Jesse’s lifetime of service”.
Meanwhile, French President Emmanuel Macron said he worked to defend peace, justice and fraternity.
