2024-12-04 17:05

Trump's return to White House spurs bitcoin investment Biotech firms set up to $1 mln treasury reserve target Skeptics call out bitcoin's volatile nature Dec 4 (Reuters) - U.S. President-elect Donald Trump's pro-crypto stance is prompting small businesses to allocate portions of their cash to bitcoin, challenging the dominance of traditional assets as companies look for more robust inflation hedges. Over the past month, biotech firms Enlivex Therapeutics , opens new tab, Acurx Pharmaceuticals , opens new tab(ACXP.O) , opens new tab and Hoth Therapeutics , opens new tab(HOTH.O) , opens new tab have set a target of purchasing up to $1 million of bitcoin to hold as a treasury reserve asset. The moves underscore the growing appeal of bitcoin as a legitimate tool for corporate treasurers, who see it as a better alternative in a landscape fraught with economic uncertainty, geopolitical risks and fiscal concerns that have complicated the outlook for conventional assets like Treasuries and cash. "The benefits of bitcoin being used as a treasury reserve asset are obviously apparent. Inject bitcoin into a company and now it's on its way into the top 100 company (by market value) rankings," said Samson Mow, CEO of crypto infrastructure firm JAN3. Corporations held around 3.3% of the total supply of bitcoin as of August, up 30% year over year, according to a report , opens new tab by bitcoin-focused financial services firm River. "The things that we've been going through in the last three or four years were such that evaluating bitcoin as an additional tool became a must," Enlivex CEO Oren Hershkovitz said. "We were considering this regardless of Trump's election, but it was definitely another argument in favor of executing this strategy." Once confined to the fringes, bitcoin has soared in popularity in the last few years after endorsements from major institutions. Trump's promise of a crypto-friendly administration has grown its clout further. "The next four years should be pretty good for crypto," Acurx CEO David Luci said. The incoming president has said he wants to make the U.S. the "crypto capital of the planet" and has promised a council to advise on industry-related policy. Still, skeptics say the volatility risks associated with bitcoin, given its notorious price fluctuations, make it unfit as an inflation hedge. Securities and Exchange Commission Chair Gary Gensler has called the asset speculative and volatile, even as the regulator approved spot bitcoin exchange traded funds earlier this year. The currency has also mirrored declines in the S&P 500 index (.SPX) , opens new tab during periods of economic slowdown in the past, calling into question its effectiveness. But such criticism is "unfair," said Henry Robinson, co-founder of crypto mining firm Decimal Digital Currency, adding that "bitcoin is not uniquely volatile." BALANCING HYPE WITH FOCUS MicroStrategy (MSTR.O) , opens new tab, the largest corporate holder of bitcoin, pioneered the approach of integrating bitcoin into its treasury in 2020. Since then, the token's influence on the company's stock price has been significant, with shares often moving in lockstep with the overall crypto sentiment. But recent adopters of bitcoin have emphasized that they do not plan on becoming a proxy for the currency and will continue focusing on their core business. "We're a biotech company. We focus on developing our clinical assets. What I know how to do at the end of the day is to take a drug from pre-clinical to clinical to approval," Enlivex's Hershkovitz said, referring to the different stages of testing an experimental treatment. Analysts say companies could explore ways to monetize their bitcoin holdings without selling them, should they need capital, by using the currency reserves as collateral to secure loans, either from banks or investors. "Lending against crypto is totally normal and the collateral is safe," Decimal Digital's Robinson said. The hype around bitcoin may also drive stock valuations higher, giving such companies added leverage to sell shares for their capital needs. MicroStrategy shares have jumped over 31-fold since it made bitcoin its primary treasury reserve asset. "The balance sheets of these companies will be more attractive to the public," said Brandon Mintz, CEO of Bitcoin Depot (BTM.O) , opens new tab, which began investing a portion of its cash into the crypto in June. MicroStrategy and Hoth did not immediately respond to a request for comment. Sign up here. https://www.reuters.com/business/finance/trumps-crypto-advocacy-steers-businesses-away-traditional-treasury-assets-2024-12-04/

2024-12-04 14:56

MOSCOW, Dec 4 (Reuters) - Russian President Vladimir Putin on Wednesday questioned the need to hold state reserves in foreign currencies since they could easily be confiscated for political reasons, saying that domestic investment of such reserves was more attractive. Western countries froze about $300 billion of Russian reserves, accumulated from windfall energy revenues, at the start of the Ukraine war in 2022. Discussions are ongoing among G7 countries on how these funds could be used to support Ukraine. "A legitimate question: why accumulate reserves if they can be lost so easily?" Putin said in remarks to an investment conference. He suggested that investment of state savings into infrastructure, logistics, science and education was more reliable than holding them in foreign assets. Putin said the current U.S. administration was undermining the role of the U.S dollar as the reserve currency in the global economy by using it for political purposes, forcing many countries to turn to alternative assets, including cryptocurrencies. "For example, bitcoin, who can prohibit it? No one," Putin said. He added that development of new payment technologies was inevitable, due to their lower costs and reliability. Sign up here. https://www.reuters.com/markets/currencies/russias-putin-questions-need-dollar-forex-reserves-touts-bitcoin-2024-12-04/

2024-12-04 12:51

OSLO, Dec 4 (Reuters) - Equinor's (EQNR.OL) , opens new tab head of renewable energy Paal Eitrheim has resigned to take up an executive position at power producer Statkraft, the two Norwegian companies said on Wednesday. Equinor earlier this year abandoned its offshore wind activities in Vietnam, Spain, Portugal and France, while scaling back plans in Australia, and last month said it was cutting 20% of the staff from its renewable energy division. Jens Oekland will take over as interim chief of Equinor's renewables division, the company said in a statement. While Eitrheim is replaced immediately, he will remain available to Equinor until May 31 of next year, Equinor said. Statkraft said he would join the company no later than June of 2025 to become executive vice president for the company's Nordic business, overseeing among other responsibilities its key Norwegian hydropower business. Sign up here. https://www.reuters.com/business/energy/equinor-renewables-chief-resigns-take-up-statkraft-job-2024-12-04/

2024-12-04 12:39

BUDAPEST, Dec 4 (Reuters) - Hungary has asked the United States to exempt Russia's Gazprombank from sanctions when it comes to payments for natural gas as those sanctions could negatively affect some U.S. allies, Hungary's foreign minister said on Wednesday. The United States imposed new sanctions on Russia's Gazprombank on Nov. 21 as President Joe Biden steps up measures to punish Moscow for its invasion of Ukraine before he leaves office in January. The sanctions prevent the state-controlled lender from handling any new energy-related transactions that involve the U.S. financial system. "Yesterday we filed our request with the relevant American authorities that calls for Gazprombank being granted an exception from sanctions when it comes to payments for natural gas," Foreign Minister Peter Szijjarto told a briefing broadcast on his Facebook page. Szijjarto, who was speaking in Brussels after a meeting of NATO foreign ministers, cited U.S. Secretary of State Anthony Blinken as saying that he was "willing to consult with allies for whom the sanctions caused problems". Hungary receives about two-thirds of its gas imports from Russia, but pressure is mounting for the country along with some of its neighbours to diversify more quickly away from Russian energy, following Moscow's 2022 invasion of Ukraine. Hungary has been receiving 4.5 billion cubic metres (bcm) of gas per year from Russia under a 15-year deal signed in 2021. Szijjarto said any exemption would be similar to those granted to other Russian banks that process payments for Russian uranium bought by the United States. The minister said he would travel to Washington later on Wednesday but did not say what the focus of his talks there would be. On Monday, Szijjarto travelled to Moscow for talks with Russian Energy Minister Alexander Novak and said that Hungary was working on a solution to be able to pay for Russian gas after Gazprombank was put on the U.S. sanctions list. Sign up here. https://www.reuters.com/business/energy/hungary-requests-us-sanctions-exemption-gas-payments-gazprombank-2024-12-04/

2024-12-04 12:31

Dec 4 (Reuters) - Canada-based uranium miner NexGen Energy (NXE.TO) , opens new tab said on Wednesday it had signed its first agreements with U.S. utility companies to supply 5 million pounds of the nuclear fuel ingredient. Uranium will be supplied from NexGen's Rook I Project currently being developed in Saskatchewan. The company anticipates annual delivery of about 1 million pounds per year from 2029 to 2033 subject to the commencement of commercial production. Travis McPherson, chief commercial officer of NexGen, told Reuters this announcement is in line with the company's strategy to get small contracts in place to effectively backstop debt financing required for the construction of its mine in the Western Canadian province. WHY IT'S IMPORTANT Nuclear energy has come into focus in recent years as companies explore alternative sources of power to drive the rapid development of artificial intelligence tools and vast data centers. Russia's temporary ban on enriched uranium to U.S. utility companies highlighted the need to diversify supply from friendly countries. U.S. President-elect Donald Trump's threat to impose 25% tariffs on all exports from Canada, however, has added to the uncertainty around the supply of the commodity. The U.S. Energy Information Administration estimates record-high power consumption in 2024 and 2025. NexGen Energy is also in discussions with additional U.S., European, and Asian utilities for similar contracts. CONTEXT The sales contracts announcement follow the company's completion of an important step of the ongoing Federal Environmental Assessment for the Rook I project. NexGen is well-positioned to secure financing if the project secures federal approval in 2025, RBC Capital Markets analyst Andrew Wong wrote in a note, adding that the terms of the contract likely "mitigates the risk from potential delays in project start-up." KEY QUOTES "Energy demand from reliable sources is increasing by the week with the need to expand existing nuclear energy infrastructure and the construction of power consuming data centres at a time the security of uranium supply is under significant technical and sovereign risk," NexGen CEO Leigh Curyer said. SHARE REACTION Shares of the company were up 1.7% to C$11.63. Sign up here. https://www.reuters.com/markets/commodities/nexgen-inks-uranium-sales-agreements-with-major-us-utilities-2024-12-04/

2024-12-04 12:22

MILAN/PARIS, Dec 4 (Reuters) - Targets deemed unrealistic or destructive by some board members triggered the sudden fall of Stellantis CEO Carlos Tavares just a month after he received their full backing, two people with knowledge of the matter told Reuters. Unhappy with his aggressive targets for sales and cost cuts and his contentious dealings with the giant automaker's suppliers, dealers and unions, the board unanimously wanted Tavares to go, the sources said. "Something broke in November," one of the sources said. Tavares resigned on Sunday, leading to a selloff of shares in the world's fourth-biggest automaker, which owns brands including Jeep, Ram, Fiat, and Peugeot. Details of the clashes leading to his ouster have not been previously reported. Tavares did not respond to requests for comment. Stellantis declined to comment further. On Sunday, Senior Independent Director Henri de Castries said in a statement that differing views emerged in recent weeks among the CEO, major shareholders and the board. The outspoken chief executive, who earlier this year was paid 36.5 million euros in compensation based on Stellantis' 2023 results, had annoyed some board members in October, at the Paris car show, by publicly blaming the automaker's U.S. management for falling sales and rising inventories in that market, one of the sources said. But the board continued to back him. In November, however, Tavares' brash style led to a "totally untenable" relationship with the board, whose members represent major shareholders Exor (EXOR.AS) , opens new tab, the Peugeot family and the French government, the other source said. When board members started asking more specific questions about the executive's strategies, the person said, "Tavares' reaction was: 'You do not interfere with my job - that is not your business.'" Board members, irritated, continued pressing Tavares, the source said. They were unsettled by what they viewed as the CEO's relentless but narrow focus on cost-cutting, which had caused supply disruptions and angered dealers. Those problems had been overlooked in previous years, when Stellantis was hitting double-digit profit margins. Now those and other issues were causing angst across the sprawling company, as Tavares tangled with dealers, unions, suppliers and governments - and now board members. "You cannot make enemies with everybody," the person said. DAUNTING TO-DO LIST The clashes led the board to oust Tavares with no one to replace him. It was a stunning reversal from its plan for a smooth succession when he retired in 2026 as scheduled. Chairman John Elkann had declared on Oct. 10 that the board was "unanimous in its support of Carlos Tavares" even as the company jettisoned its CFO and its North American chief the same day. Stellantis is now searching for a new chief executive with a daunting to-do list: stabilise a global company with 14 brands, bloated U.S. inventories and falling U.S. and European market share - all while facing surging Chinese EV rivals, tough new European emissions standards and disruptive electric vehicle and trade policies championed by U.S. president-elect Donald Trump. Stellantis issued a major profit warning at the end of September that had undermined Tavares' reputation as an industry leader in maximising profit margins and payouts for investors. Dealers, industry experts, and customers say the company has priced itself out of the market in both the United States and Europe. Stellantis shares are down 43% so far this year. Tavares was well known throughout his tenure at both Peugeot maker PSA and then Stellantis - formed in 2021 when Peugeot merged with Fiat Chrysler - for his top-down leadership style, leaving no one in doubt as to who was in charge. But in November, board members felt compelled to confront Tavares, one of the sources said. "Something had to be done," the person said. BATTLING UNIONS, SUPPLIERS, THEN DIRECTORS One source said the first sign of tensions between Tavares and the board came over in recent weeks on how to handle European Union rules that will levy hefty fines unless electric vehicles account for at least 21% of Stellantis' 2025 sales - a big jump from the automaker's 12% EV share so far this year. Tavares refused to back an auto industry lobbying push now underway to renegotiate the rules, saying instead that Stellantis would simply work to avoid fines. The board feared the company would have to "massively decrease" combustion-engine car sales to hit the regulatory target, one of the sources said. Company staffers were "totally lost" over the "irrationality" of the view that Stellantis could achieve such a large EV share increase without fines, the person said, which prompted the board to question Tavares. Both sources used the term "radical" to describe Tavares' sales targets. Tavares also outlined other controversial plans at board meetings in November, saying he wanted to drastically cut costs in Europe that had already been "cut to the bone", one source said. Tavares, the source said, also proposed a cash-management policy focused on 2024 at the expense of 2025 cash flow. This might have exposed Stellantis to a new profit warning in the future, the second source said. Board members also bristled at Tavares' often-contentious dealings with key players across what one source described as the "ecosystem" surrounding Stellantis, including tensions with "suppliers, dealers, consumers," the governments of Italy and France, and U.S. labour unions. Tavares, the source said, sometimes viewed suppliers as expendable in his cost-cutting drive, while board members worried that replacing trusted parts makers was not quick and caused disruptions. "You cannot just say 'you're out'" to longtime suppliers, the source said. "That puts at risk your very capacity to produce cars." Sign up here. https://www.reuters.com/business/autos-transportation/radical-targets-toppled-tavares-stellantis-sources-say-2024-12-04/