Weekly Reads - August 1, 2022
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Oxford based nuclear energy company First Light Fusion is in the midst of raising $400 million euros in capital potentially reaching unicorn status in the next few months. The company was founded in 2011 by its current chief executive Nick Hawker and was a spinout of Oxford University. The company is endorsed by Sir Patrick Vallance the U.K government’s chief scientific adviser and targeting completion of its capital raising in the upcoming few months. First Light Fusion’s claim to fame was its announcement that it had combined atomic nuclei which is a crucial step towards generating nuclear fusion power in order to meet increasing global demand for clean energy. The company intends to use the money its raising to commercialize its technology with claims that it already has made more rapid progress towards its objectives than any other fusion technology in history. With an investor base including Oxford Science Enterprises (who backs spinouts from the city’s world-leading universities) and Tencent the company faces high expectations in their quest to further nuclear energy. With a global movement toward renewable energy First Light Fusion could be a key player in growing nuclear energy adoption across the globe.
Cosmetic giant Estee Lauder is back to wheeling and dealing with talks to acquire luxury brand Tom Ford for $3 billion, which would be the largest acquisition in company history. Estee Lauder already has a long standing licensing deal with Tom Ford for its beauty products with both companies working together on previous launches. Tom Ford is primarily known as a menswear company with other divisions including womenswear, accessories, cosmetics, and fragrances. This acquisition would be atypical for Estee Lauder who will be acquiring a traditional luxury fashion business with a growing yet relatively smaller beauty division versus their traditional M&A targets of pure beauty brands. There are already reports the company might license out the fashion business and focus solely on Tom Ford’s beauty business which management has indicated has been growing double digits with growth especially strong in China. With talks ongoing it’s difficult to forecast what the company’s long-term plan for Tom Ford’s luxury portfolio will entail.
Pepsi continues its foray into the energy drink market with a $550 million investment in energy drink maker Celsius Holdings. Pepsi who already paid $3.85 billion to acquire Rockstar in 2020 and has provided distribution for another fast-growing energy drink upstart, Bang Energy, is making another sizable bet in an industry dominated by giants Monster and Red Bull. Pepsi’s Celsius investment provides Celsius with a long-term distribution deal which could help fuel its goal in continuing to take market share from incumbents. Celsius who brands itself as a “healthy” energy drink is now the 4thmost popular energy drink in the U.S surpassing Rockstar. Pepsi’s energy drink expansion strategy has a rocky track record with its partnership with Bang Energy souring over time and ending in a legal battle and the company struggling to revitalize the Rockstar brand. With Celsius, Pepsi continues to broaden its energy drink portfolio hoping to expand its market share in the fastest growing beverage market outside of alcohol.