# OpenAI Joins a Massive IPO Pipeline Now Worth $3.6 Trillion

An episode of [Bloomberg Intelligence](https://invisiblenetwork.ai/podcast/326301337), 9 Jun 2026, 24 min.

Audio: https://podtrac.com/pts/redirect.mp3/tracking.swap.fm/track/UVBrz8bN8aM2Xe47PEPu/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/7f534b8c-9e91-429a-b102-ae3c00090c6d/82b26116-d1ac-4bc0-8bde-b46401135779/audio.mp3?utm_source=Podcast&in_playlist=0ad812bf-fd15-4012-a18c-ae3c00090c76

Watch Paul and Scarlet LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg Intelligence hosted by Paul Sweeney, Scarlet Fu, and John Tucker -Dan Ives, Global Head of Technology Research at Wedbush Securities, discusses OpenAI becoming the third major artificial intelligence developer to confidentially file for a public listing, joining rivals in an IPO pipeline. The company is working with Goldman Sachs Group Inc. and Morgan Stanley on a potential listing as soon as the fall, according to people familiar with the matter. -Carmen Arroyo, Bloomberg Tech Reporter, discusses the Bloomberg Big Take story: “SpaceX IPO Forces Investors to Bet on Musk’s Entangled AI Empire.” Elon Musk’s imperial approach has made it difficult to decipher his companies’ true valuations. With the SpaceX IPO looming, some investors have raised concerns about SpaceX’s accounting practices, corporate governance risks and related-party transactions with other Musk entities. And as Musk aims for the stars, some investors have grown anxious about whether his goals are attainable, or if he’s bending the rules to pursue them. -Sam Fazeli, Bloomberg Intelligence, Director of Research for Global Industries and Senior Pharmaceuticals Analyst, discusses the latest in biotech sector. Eli Lilly & Co. presented data showing its next-generation shot, retatrutide, can help patients lose 30% of their body weight over about two years. -Jennifer Rie, Bloomberg Intelligence Senior Litigation Analyst, discusses Britain’s merger watchdog opening a probe into Paramount Skydance Corp.’s $110 billion takeover of Warner Bros. Discovery Inc. The Competition and Markets Authority has set an initial deadline of August 7 to rule on the deal, which would unite two Hollywood studios and major news networks. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
[0:10] Speaker 1: Bloomberg Intelligence podcast. Catch us live weekdays at ten am
[0:14] Speaker 1: Eastern on Apple, Cocklay and Android Auto with the Bloomberg
[0:17] Speaker 1: Business App. Listen on demand wherever you get your podcasts,
[0:21] Speaker 1: or watch us live on YouTube.
[0:23] Speaker 2: Through open Ai. That's the latest big AI tech company
[0:28] Speaker 2: to announce its intention to go public, and of course
[0:32] Speaker 2: it comes on the heels of SpaceX, potentially listing as
[0:36] Speaker 2: early as this Friday. The IPO is supposed to be
[0:38] Speaker 2: priced on Thursday, and Anthropic filing confidentially for an IPO
[0:42] Speaker 2: in the recent weeks. So let's bring in our next guest.
[0:46] Speaker 2: He is Dan Ives. Dan is global head of Technology
[0:48] Speaker 2: Research at Webbush Securities, and Dan, I'm curious to hear
[0:52] Speaker 2: from you whether being the last of the three mega
[0:56] Speaker 2: tech IPOs is a good place or potentially a troubling
[0:59] Speaker 2: place for open Ai. Is the company? Is any company
[1:03] Speaker 2: really at risk of the public market capital exhausting itself
[1:06] Speaker 2: because there's a lot of money that needs to find
[1:09] Speaker 2: a home for these companies.
[1:12] Speaker 3: Yeah, I mean I'd start at the ladder. I don't
[1:15] Speaker 3: think there's a risk, you know, in terms of if
[1:18] Speaker 3: you're last, there's no more tap. I mean, look, we're
[1:21] Speaker 3: coing at three the core foundational pieces of the AI
[1:25] Speaker 3: revolution and toropic Open AI. Of course SpaceX look first
[1:29] Speaker 3: to market. There's an advantage. It's important and that's why
[1:33] Speaker 3: this is going to be a continued sort of battle
[1:35] Speaker 3: arms race between open AI and DROPIC and that's essential
[1:40] Speaker 3: what investors are watching. Obviously SpaceX a you know, very
[1:43] Speaker 3: important on this watershed moment for the overall markets this week.
[1:47] Speaker 3: But to get the popcorn down, I mean, it's just starting.
[1:51] Speaker 4: For our viewers on YouTube. I always try to figure
[1:53] Speaker 4: out where in the world is Dana eyes when we
[1:55] Speaker 4: have them on via zoom, because it could be anywhere
[1:57] Speaker 4: literally on the place.
[1:58] Speaker 2: Joined us from Asia.
[2:00] Speaker 4: I know everywhere. I don't know.
[2:01] Speaker 2: In the middle of his night today, I can't figure it.
[2:03] Speaker 4: I think there's in a bunker somewhere like an a Pentagon.
[2:05] Speaker 4: But Dan talks us about what's the feedback?
[2:08] Speaker 3: Just got off the Red Eye. But I know what
[2:11] Speaker 3: a better place to be than we deal with you?
[2:13] Speaker 4: That exactly appreciate that.
[2:15] Speaker 5: Dan.
[2:15] Speaker 4: We're day three of the roadshow for space X. What
[2:18] Speaker 4: are the what's some of the feedback you're hearing from
[2:19] Speaker 4: your institutional investor clients.
[2:22] Speaker 3: Look, I think the big focus is just is it
[2:25] Speaker 3: a space play? Is it a data play?
[2:27] Speaker 5: Right?
[2:28] Speaker 3: I mean, I think that's really how investors overall are
[2:31] Speaker 3: focused on SpaceX. O can I continue to believe like
[2:35] Speaker 3: when it comes to SpaceX, it's much more on data
[2:39] Speaker 3: and AI and the ecosystem than maybe just when you
[2:43] Speaker 3: think about space and its first sort of phase. But
[2:46] Speaker 3: what we were talking about what's going to be a
[2:48] Speaker 3: decade build out a space and it's not just about SpaceX,
[2:51] Speaker 3: it's about the broader sector than now investors are really
[2:55] Speaker 3: starting to focus. You're now going to have in sutional month,
[2:59] Speaker 3: not just retail, You're going to have a space on orst.
[3:04] Speaker 2: Very well said, And I guess the question is how
[3:06] Speaker 2: do people value it going forward? Because there's different explanations
[3:11] Speaker 2: for whether this is a rocket company, a data company,
[3:14] Speaker 2: as you put it, or kind of a vertically integrated
[3:17] Speaker 2: new technology company, which is kind of what Elon Musk
[3:20] Speaker 2: is envisioning here in the same way that Tessa started
[3:23] Speaker 2: off as an electric vehicle company and has become a
[3:26] Speaker 2: lot more. How are you anticipating Elon to kind of
[3:31] Speaker 2: set the benchmark for how he's going to talk about
[3:34] Speaker 2: the the kinds of numbers that SpaceX can achieve. We
[3:37] Speaker 2: got a sense of it through the IPO perspectus, but
[3:39] Speaker 2: you know he's going to have to manage expectations quarter
[3:42] Speaker 2: after quarter here.
[3:44] Speaker 3: Yeah, no doubt, as well as what's on the rise.
[3:46] Speaker 3: And look, I think Tessa is a good group print
[3:50] Speaker 3: because you look, can you go back right? I mean,
[3:53] Speaker 3: you know when it came out here Mini bet against
[3:55] Speaker 3: Mask Tessa in numbers, in terms in the near term,
[3:58] Speaker 3: and then Alton what's out to be nonsense really changed
[4:02] Speaker 3: the world. I think to some extent, if you're buying
[4:05] Speaker 3: space X, you're buying Musk. I mean you're buying into
[4:08] Speaker 3: the Musk ecosystem now the challenge and the opportunity to
[4:12] Speaker 3: build that out execution step by step. But it's also
[4:16] Speaker 3: argue like in a year has some merger. We've said
[4:20] Speaker 3: over eighty percent chance between SpaceX and Testa Dan.
[4:25] Speaker 4: It was an important day yesterday for our friends in
[4:28] Speaker 4: Coopertino Apple and with their AI story and the narrative there,
[4:33] Speaker 4: what did you learn from their announcement?
[4:36] Speaker 3: Yeah, I mean, look, being there lives, I think this
[4:39] Speaker 3: was one where a lot different than the last two
[4:42] Speaker 3: years in a great way, because two years ago there
[4:45] Speaker 3: was all the promise and none of that really came true.
[4:48] Speaker 3: Last year, it was kind of really absent in terms
[4:51] Speaker 3: of AI strategics. I mean, Paul, now you finally have
[4:54] Speaker 3: an AI strategy. It's finally a foundational piece that you
[4:58] Speaker 3: could sell into the eCos They're no longer watchers from
[5:02] Speaker 3: the sideline. They're not going to be an anthropical and
[5:04] Speaker 3: open a eye, but.
[5:05] Speaker 5: They don't need to be.
[5:06] Speaker 3: You have one point five billion iPhones and I think
[5:09] Speaker 3: this is really going to be the start of mondivation
[5:11] Speaker 3: when it comes to AI. They laid it out, but
[5:14] Speaker 3: now devices will file the hardware ecosystem build up and
[5:18] Speaker 3: I think what this is going to do services and
[5:20] Speaker 3: obviously stocks off in terms of what we've seen knee jerk,
[5:24] Speaker 3: but I think this is one It leads the foundation
[5:26] Speaker 3: for turnus as a baton t hander from Cook.
[5:30] Speaker 2: Were you disappointed that Turners didn't speak? Some people have
[5:33] Speaker 2: cited that as one reason why overall the unveiling of
[5:38] Speaker 2: the AI infuse SORIY is not impressing investors. Today the
[5:42] Speaker 2: stock is down two point nine percent, and yesterday when
[5:45] Speaker 2: the stock gave up its early gains.
[5:47] Speaker 3: Yeah, I think this is it took shut. I mean
[5:50] Speaker 3: you're talking about you know, Mount Rushmore, Hall of Fame
[5:54] Speaker 3: or CEO. You don't want turnus there. I think that
[5:57] Speaker 3: would take away a little of the spot. I mean,
[6:00] Speaker 3: this is really cook handing the last WWDC afterwards obviously
[6:05] Speaker 3: been just a historical, legendary market. But some of it
[6:10] Speaker 3: it's going to be execution. Now it's like executing. It's
[6:15] Speaker 3: showing developers, it's building it out. I think investors, they
[6:18] Speaker 3: always tend to be skeptical on APP. I think this
[6:21] Speaker 3: time is different.
[6:23] Speaker 2: Okay, so let's talk about the fact that this time
[6:25] Speaker 2: it's different. What does you know the unveiling of this
[6:28] Speaker 2: new series mean for developers. Do they walk away with
[6:31] Speaker 2: a clear roadmap for how to integrate their offerings with
[6:34] Speaker 2: Apple's ecosystem or does this remain a wait and see
[6:37] Speaker 2: like it has been for the past two years.
[6:40] Speaker 3: Well, I think they finally got what they want. I
[6:41] Speaker 3: think it's developers now that they actually have the platform
[6:45] Speaker 3: to build out. This is no longer something on a
[6:48] Speaker 3: whiteboard or there's some conceptual Now it's actually going to
[6:52] Speaker 3: be the put And also it's about the app actually
[6:54] Speaker 3: shape them building. It's about Gemini obviously as a foundation,
[6:58] Speaker 3: which isn't just cooking cut Gemini in terms of what
[7:01] Speaker 3: they've built. And now Apple is basically saying, like from
[7:05] Speaker 3: a privacy security you, your data is will not going
[7:08] Speaker 3: to be shared externally. And now it's the start of
[7:12] Speaker 3: how they monetize it. Cloud, more applications, more devices that
[7:17] Speaker 3: ultimately feed into this the consumer AI revolution. Apple They're
[7:23] Speaker 3: essentially they're they're a toll collector on the AI consumer highway.
[7:28] Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
[7:35] Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live
[7:39] Speaker 1: weekdays at ten am Eastern on Apple Cocklay and Android
[7:42] Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
[7:45] Speaker 1: you get your podcasts, or watch us live on YouTube.
[7:49] Speaker 4: Comana Royal joints us here. She's a tech reporter for
[7:51] Speaker 4: Bloomberg News. She and Dana Hall have a great, great
[7:55] Speaker 4: story out today. SpaceX IPO forces investors to bet on
[7:59] Speaker 4: must entangled AI empire. Carmen, thanks much for joining us
[8:03] Speaker 4: here in studio. I guess this IPO is really just
[8:08] Speaker 4: a bet on Elon Musk and his vision and all
[8:12] Speaker 4: that type of stuff. But he's got a lot of
[8:15] Speaker 4: interest out there and a lot of different companies. How
[8:17] Speaker 4: do investors thinking about that?
[8:18] Speaker 6: Yeah, that's exactly kind of like the point we tried
[8:20] Speaker 6: to do with the story. It's like it's not only
[8:22] Speaker 6: a bet on this specific company, It's like all his
[8:24] Speaker 6: companies have like intermingling businesses and it's becoming more so.
[8:29] Speaker 6: He's trying to create this like vertically integrated AI company
[8:32] Speaker 6: basically that has all the supply chain in it. So
[8:36] Speaker 6: if you're buying SpaceX stock, you need to take all
[8:38] Speaker 6: of Elon's world into account, not just the company itself.
[8:44] Speaker 2: It kind of reminds me of how Tessel was once
[8:46] Speaker 2: upon a time an electric vehicle company and it's become
[8:50] Speaker 2: something much more than that. SpaceX was a rocket company,
[8:54] Speaker 2: a rocket launch company, but now it's got AI in there.
[8:58] Speaker 2: It's what was formerly on his Twitter in there, and
[9:01] Speaker 2: a lot of people are expecting it's going to also
[9:03] Speaker 2: have Tesla in there as well. They're going to combine
[9:05] Speaker 2: it two.
[9:06] Speaker 6: Yes, exactly. It feels like both Musk's key companies, which
[9:10] Speaker 6: are Tesla and SpaceX, had their own goals at one
[9:13] Speaker 6: point and then in the past six years, he's turned
[9:17] Speaker 6: both of them into AI and now with a purchase
[9:20] Speaker 6: of like XAI and x into SpaceX, that's become a
[9:22] Speaker 6: lot more clear. Like Tesla's like no focusing on human
[9:25] Speaker 6: aid robots and SpaceX want to do the satellite on space.
[9:29] Speaker 6: And it's kind of like all in search of like AGI,
[9:33] Speaker 6: like artificial general intelligence and like who's going to get
[9:36] Speaker 6: there first and how they're going to do it. And
[9:38] Speaker 6: Alon clearly doesn't want to lose, and he's really concerned
[9:41] Speaker 6: with like having the right infrastructure in place. He doesn't
[9:44] Speaker 6: He thinks I compute and power are going to be
[9:46] Speaker 6: like bottlenecks for the industry, so he's trying to make
[9:49] Speaker 6: sure that he doesn't have those bottlenecks.
[9:52] Speaker 4: When I first started on Wall Street nearly forty years
[9:55] Speaker 4: ago today, somebody taught me go to the when he
[9:59] Speaker 4: goes yeah, IPO perspectives and pick one up. Go to
[10:01] Speaker 4: the related party transactions. That's the first place you go,
[10:05] Speaker 4: and boy, there are a lot of related party transactions here.
[10:08] Speaker 4: Is are we getting any reporting back that from this
[10:10] Speaker 4: road show that there's pushback from investors or investors willing
[10:13] Speaker 4: to give Elon benefit the down.
[10:15] Speaker 6: It depends on who you ask. There's like some investors
[10:19] Speaker 6: that really believe in Elon. You have to like bet
[10:21] Speaker 6: on him.
[10:22] Speaker 4: Yep.
[10:22] Speaker 6: I think that if if it's more integrated, just because
[10:25] Speaker 6: it's like it's going to become a conglomerate and it
[10:27] Speaker 6: makes sense for innovation. There's others that don't really like it.
[10:31] Speaker 6: They think like there's not enough corporate governance and it's
[10:33] Speaker 6: going to be less especially if spaces and stuff buying Tesla,
[10:37] Speaker 6: And sometimes it's hard to figure out what's the valuation if,
[10:41] Speaker 6: like Elon has had both sides of every transaction. So
[10:44] Speaker 6: there's definitely concerns around.
[10:47] Speaker 2: What's the value here, not just that I feel like
[10:51] Speaker 2: a while ago, there was a lot of premium put
[10:54] Speaker 2: into the idea that you could have a big conglomerate
[10:56] Speaker 2: with businesses that are kind of loosely integrated but you know,
[11:00] Speaker 2: just tangentially. And now companies, especially those industrials, want to
[11:05] Speaker 2: be very very narrowly focused on the other side of
[11:09] Speaker 2: the equation. You're looking at some of these big tech
[11:11] Speaker 2: companies like a SpaceX, like Tesla get bigger and bigger
[11:15] Speaker 2: and you know, kind of mimic what those industrials were doing.
[11:18] Speaker 2: Is SpaceX kind of like the new Ge.
[11:21] Speaker 6: That's what some investors are starting to think about, like
[11:24] Speaker 6: does it become too unwildy and it ends up like
[11:26] Speaker 6: Ge Or does he manage to actually have advertically integrated
[11:31] Speaker 6: Other tech companies have gotten bigger, but sometimes they spin
[11:34] Speaker 6: off their ventures. It doesn't seem like that's what he
[11:38] Speaker 6: long wants to do. It's kind to the opposite. So
[11:40] Speaker 6: that's definitely a question on everyone's mind. All right.
[11:43] Speaker 4: What I like about your story, in addition to the
[11:46] Speaker 4: deep reporting, is you have this nice graphic that tries
[11:48] Speaker 4: to explain must universe and how it's become more intertwined.
[11:53] Speaker 4: It's a graphic here and it tries to show you
[11:56] Speaker 4: how things are interrelated. It's not helping me here, dude. Yeah,
[11:59] Speaker 4: I mean, is there is so much stuff out there
[12:02] Speaker 4: that he owns kind of owns influences. This is a
[12:06] Speaker 4: lot for investors, isn't it.
[12:08] Speaker 6: Yeah? I mean the graphic is a lot, but it
[12:11] Speaker 6: kind of shows how Tessa first bought Solar City, and
[12:15] Speaker 6: like all his more successful ventures, tend to buy his
[12:18] Speaker 6: more flailing ones. So Solar City was struggling and then
[12:21] Speaker 6: Tessa bought it a decade ago. Twitter was struggling under
[12:25] Speaker 6: the dead load, Xai bought it. Then Xtai was spurning
[12:28] Speaker 6: a lot, SpaceX spotted. So it just feels like every
[12:33] Speaker 6: single struggling company and suff swallowed is the expection.
[12:38] Speaker 4: Is the expectation that SpaceX will buy Tesla.
[12:42] Speaker 6: That's part of the market shatter. Now I don't know.
[12:46] Speaker 2: I mean, you'd make this graphic a lot more simple.
[12:49] Speaker 2: Swallowed by SpaceX.
[12:51] Speaker 4: All Right, so folks, you have to go out on
[12:52] Speaker 4: the Bloomberg termor will go into Bloomberg dot com and
[12:54] Speaker 4: check out this story. It's really really good if you're
[12:56] Speaker 4: trying to get a handle on one aspect of this deal,
[12:58] Speaker 4: which is the inter party and the related transactions, this.
[13:02] Speaker 2: Story really stay with us. More from Bloomberg Intelligence coming
[13:06] Speaker 2: up after this.
[13:11] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[13:14] Speaker 1: weekdays at ten am Eastern on Apple Coarclay, and Android
[13:18] Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever
[13:21] Speaker 1: you get your podcasts, or watch us live on YouTube.
[13:25] Speaker 4: Fuck a little healthcare here, we do that with Sam Fazzelli,
[13:27] Speaker 4: Director of Research for Global Industries and a senior pharmaceuticals
[13:30] Speaker 4: analysts Bloomberg intelligence. He's based in London. I have no
[13:33] Speaker 4: idea where he is, but he's based in London. Sam
[13:36] Speaker 4: talk to us about Eli Lilly and their obesity products offerings.
[13:44] Speaker 4: Where do they stand in this market? Where are they
[13:45] Speaker 4: going to go going forward?
[13:48] Speaker 5: Yeah, so Paul, they continue to lead in terms of efficacy,
[13:52] Speaker 5: So zip bound has the better efficacy proven in a
[13:56] Speaker 5: head to head trial versus. And they now have this
[14:02] Speaker 5: drug or the retro truetide or retatrotide as I like
[14:05] Speaker 5: to call it, which is a triple mechanisms of action,
[14:10] Speaker 5: and that is got to blowout efficacy. Particularly obviously they
[14:15] Speaker 5: tried it in people with a very high level of
[14:18] Speaker 5: obesity where you can lose thirty percent of your body
[14:22] Speaker 5: weight and not be seriously suffering. So again they have
[14:27] Speaker 5: this mechanism of action that this triple product that seems
[14:31] Speaker 5: to be doing very well. A whole bunch of other
[14:33] Speaker 5: companies have reported and they still lead in the oral space.
[14:39] Speaker 5: Astro Senecus have some good data and that looks good,
[14:41] Speaker 5: that looks competitive, and they're moving to phase three. They
[14:44] Speaker 5: have other plans for that space. So Lily still really
[14:47] Speaker 5: is in the lead here in terms of efficacy, particularly
[14:53] Speaker 5: how much.
[14:53] Speaker 2: Do consumers patients care about efficacy. I mean, all of
[14:57] Speaker 2: these drug makers have treatments that are effective, but are
[15:02] Speaker 2: they making the distinction between twenty seven percent versus thirty percent?
[15:06] Speaker 5: Very good question, Scarlett. The interesting thing here is that
[15:12] Speaker 5: you are coming and I'm sure you have across more
[15:15] Speaker 5: and more people who talk about microdosing, right, So they
[15:20] Speaker 5: lose the desired amount of weight that they want and
[15:23] Speaker 5: then they just want to keep it at base, so
[15:25] Speaker 5: they go into a lower dose that I don't even
[15:27] Speaker 5: know how they calculate that, their physician maybe helps them
[15:30] Speaker 5: calculate it. It gets rid of some other side effect profiles.
[15:33] Speaker 5: So really these big numbers and you know, and I've
[15:37] Speaker 5: said this before, and although the answer Toude question was
[15:41] Speaker 5: literally leads bone efficacy, but when you think about it,
[15:45] Speaker 5: does it matter for me If I'm I don't know,
[15:48] Speaker 5: ninety five kilos and I lose ten kilos over the
[15:51] Speaker 5: space of six months, whether that was twelve or eight,
[15:56] Speaker 5: I'm still losing quite a lot of weight and getting
[15:59] Speaker 5: into shape and then allowing me to do everything else
[16:02] Speaker 5: that I need to do. So I agree with you,
[16:04] Speaker 5: it's not as important. And the market's telling us that
[16:07] Speaker 5: except that bound is the best drug out there.
[16:10] Speaker 4: So Sam was quoting weight in kilo's, like, we know
[16:13] Speaker 4: what a kilo is, but at least it didn't go
[16:14] Speaker 4: stone on us.
[16:15] Speaker 5: Lost by two point two two point two to get
[16:18] Speaker 5: two pounds.
[16:19] Speaker 4: Where Sam, Eli Lilly in twenty twenty two had twenty
[16:23] Speaker 4: eight billion dollars of revenue. You guys out there on
[16:25] Speaker 4: Wall Street are projecting eighty five billion this year. Where
[16:29] Speaker 4: did that sixty billion of revenue come from?
[16:32] Speaker 5: It's majority of it is obesity. So you know, I mean,
[16:36] Speaker 5: this has been a great company for a long time,
[16:40] Speaker 5: as because how do we measure farmer companies their growth profile,
[16:44] Speaker 5: their earnings profile, their margin evolution, but also their pipeline. Right,
[16:49] Speaker 5: and so they've hit the jackpot today. And I'll tell
[16:51] Speaker 5: you what, Paul, They're out there deal after deal. We
[16:55] Speaker 5: talked about it last week. I think the amazonification of
[16:58] Speaker 5: being a farmer company. Do everything right. They go after
[17:01] Speaker 5: infectious diseases, everything they can get their hands on, and
[17:06] Speaker 5: just just you know, feather that nest. So are they
[17:09] Speaker 5: and we've had another deal in the sector, right, Yes.
[17:12] Speaker 2: I wonder to what extent Eli Lilly going out there
[17:15] Speaker 2: and being and doing the sort of position of strength
[17:17] Speaker 2: means that they're setting new benchmarks and overpaying and forcing
[17:20] Speaker 2: everyone else to overpay. Maybe they're not overpaying, but I
[17:24] Speaker 2: defer to you on that.
[17:26] Speaker 5: But they certainly have bigger firepower, right, I mean, my
[17:29] Speaker 5: checkbook's bigger than your checkbook. Is the kind of situation
[17:32] Speaker 5: I think they're in. But I think they're very disciplined.
[17:34] Speaker 5: I think you sometimes look at things you go, wow,
[17:37] Speaker 5: that's a big number for a deal of this size,
[17:40] Speaker 5: of this stage of development. But then what do you
[17:42] Speaker 5: find after six months and nine months, twelve months. Of
[17:44] Speaker 5: course dructs fail, there's issues that happened. But we just
[17:47] Speaker 5: had been looking at one called Colonia that they've done,
[17:49] Speaker 5: and the dation is looking really good. It's a totally
[17:52] Speaker 5: novel way of treating cancers using what we call in
[17:57] Speaker 5: vivo carti. That's not going to the detail, but totally
[18:00] Speaker 5: novel way. And at the time they did the sketching,
[18:03] Speaker 5: hay a little bit, they must know something. And of
[18:05] Speaker 5: course as the datas come out, yes they did know something.
[18:08] Speaker 5: Some of that data is looking better, So you know,
[18:11] Speaker 5: I think farmer companies have to think strategically too. It's
[18:13] Speaker 5: not just about a multiple today or an MPV analysis.
[18:17] Speaker 5: Does this really give me a great portfolio to go
[18:22] Speaker 5: and make a difference in this disease and be heard
[18:25] Speaker 5: by physicians real quick?
[18:27] Speaker 4: Sam gske GSK, a big farmer company, bought Neuvalent for
[18:32] Speaker 4: ten point six billion. What is Neuvalent?
[18:35] Speaker 5: So Newvalent is a biotech company that did what a
[18:39] Speaker 5: lot of these new biotech companies are doing, finding ways
[18:43] Speaker 5: of making fourth generation, third generation drugs with the science
[18:48] Speaker 5: and technology that's been evolving over the past five to
[18:50] Speaker 5: ten years, fifteen years. And that's exactly where this deal
[18:54] Speaker 5: comes into. You look at the headline number, you can
[18:57] Speaker 5: go that's really really you know, it's a full price
[19:00] Speaker 5: if you don't want to say overpaid. But then of
[19:03] Speaker 5: course for GSK, it's a strategic decision, right they need
[19:06] Speaker 5: to have getting into lung cancer. Here's two drugs to
[19:10] Speaker 5: put into your lung cancer bag.
[19:14] Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
[19:21] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
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[19:36] Speaker 4: You know, we're looking at Paramounts Guidance one hundred and
[19:38] Speaker 4: ten billion dollar takeover Warner Brothers Discovery. This is right
[19:41] Speaker 4: in my backyard. I spend decades putting these companies together,
[19:44] Speaker 4: and now you get Paramounts Guidance looking to buy Warner
[19:47] Speaker 4: Brothers Discovery. But apparently the UK's got a problem with it. Apparently.
[19:52] Speaker 6: I think a lot of people have a problem with that.
[19:53] Speaker 4: I think so apparently, you know, so, I think it's
[19:57] Speaker 4: just something that's not necessarily going to be passed without
[20:01] Speaker 4: some big time review, and we want to review the
[20:04] Speaker 4: anti trust. We go to Jennifer Ree, senior litigation analyst
[20:08] Speaker 4: at Bloomberg Intelligence. Jen thanks so much for joining us
[20:12] Speaker 4: here talk to us about what's going on with this
[20:14] Speaker 4: deal and the United Kingdom.
[20:19] Speaker 7: We're happy to me, Paul and John. I mean, you
[20:21] Speaker 7: know what's happening here is that, like most big global deals,
[20:24] Speaker 7: this deal triggered these notification requirements across the world, not
[20:28] Speaker 7: just in the US and EU and UK, but elsewhere also,
[20:32] Speaker 7: and they have to get clearance from these entities before
[20:34] Speaker 7: they can go ahead and close their deal legally. So
[20:38] Speaker 7: you know you've heard as you mentioned there's been a
[20:40] Speaker 7: lot of opposition. There's been political opposition, there's been opposition
[20:43] Speaker 7: from labor groups coming for this deal, and so these
[20:46] Speaker 7: agencies really have to investigate. You know, this is just
[20:49] Speaker 7: the position they're in, and you have a lot of
[20:51] Speaker 7: different markets that they're going to be looking at. So
[20:54] Speaker 7: the UK's opened an investigation. They've set an end date
[20:57] Speaker 7: for that phase one investigation of August seventh, and at
[21:00] Speaker 7: that point they're going to have to decide what they
[21:02] Speaker 7: want to do. Do they have some concerns about the
[21:05] Speaker 7: impact on different markets from this combination. Are there remedies
[21:09] Speaker 7: that have been offered that could resolve those concerns that
[21:11] Speaker 7: they can get it closed up more quickly, or do
[21:13] Speaker 7: they need to continue to investigate, which would be opening
[21:15] Speaker 7: a phase two, which I think would be you know,
[21:18] Speaker 7: a difficult thing for these companies that intend to close
[21:20] Speaker 7: in the third quarter and also have a ticking pee
[21:23] Speaker 7: that's going to start to kick in for paramount as
[21:25] Speaker 7: of September thirty, so they're going to want to get
[21:27] Speaker 7: this cleared up before then.
[21:29] Speaker 2: Is there one concern that Trump's everything else?
[21:30] Speaker 4: I mean, are my streaming prices going on?
[21:35] Speaker 7: You know, it's funny. I think what everybody thinks about
[21:37] Speaker 7: is streaming, because that's what we all understand, and we're consumers,
[21:40] Speaker 7: all of us for these streaming services. But I just
[21:43] Speaker 7: don't see that streaming overlap being problematic anywhere in the world.
[21:47] Speaker 7: You know, Paramount plus and HBO are the two entities
[21:49] Speaker 7: that would come together, and they are still relatively small
[21:53] Speaker 7: in the world of streaming compared to Netflix and Disney
[21:56] Speaker 7: Plus and all the others. And I don't think anywhere
[22:00] Speaker 7: and buying market share gets anywhere near thirty percent, and
[22:02] Speaker 7: that's kind of a flashpoint for antitrust. Under thirty percent,
[22:06] Speaker 7: you probably don't have concerns. Over thirty percent, you probably do.
[22:09] Speaker 7: So I think any agency regulator that's looking at this
[22:14] Speaker 7: can probably get past that streaming concern.
[22:17] Speaker 4: Jen just summarize for us, what's the status of the
[22:19] Speaker 4: regulatory review in the US here the federal versus state.
[22:23] Speaker 7: You know, it's really complicated. In the United States, there's
[22:27] Speaker 7: a mandatory antitrust waiting period that allows the Department of
[22:31] Speaker 7: Justice in this case, to investigate the deal. If that
[22:34] Speaker 7: period expires, if the Department of Justice allows it to expire, legally,
[22:38] Speaker 7: the companies are free to close. That happened. But even
[22:41] Speaker 7: though the Department of Justice allowed that period to expire,
[22:44] Speaker 7: there have been news reports that it is continuing to
[22:47] Speaker 7: investigate the deal, which is a little bit odd. It's
[22:50] Speaker 7: just an unusual sort of set of circumstances. Even if
[22:54] Speaker 7: that period has expired, the Department of Justice could still
[22:57] Speaker 7: do something. They could still sue, which I highly doubt
[22:59] Speaker 7: that will, or they could still seek remedies and enter
[23:02] Speaker 7: a consent order. There's nothing that stops them. But if
[23:05] Speaker 7: they don't do something and all these other clearances come through,
[23:08] Speaker 7: the companies legally can go ahead and close their deal.
[23:11] Speaker 7: Now we've heard that the states, led by California, a
[23:15] Speaker 7: group of states I should say, are thinking about suing
[23:17] Speaker 7: to block the deal as well. If they do that,
[23:20] Speaker 7: what they're going to need to do is get a
[23:22] Speaker 7: preliminary injunction because the time it will take them for
[23:26] Speaker 7: a judge to get to a decision on permanently blocking
[23:28] Speaker 7: the deal is probably nine months, eight months, nine months
[23:32] Speaker 7: maybe even more from the time they file, and by
[23:34] Speaker 7: then I think the other clearances will probably be in
[23:37] Speaker 7: and the companies could close, and it is much harder
[23:40] Speaker 7: to get a decision unwinding a deal, So the first
[23:42] Speaker 7: thing they would do is seek a preliminary injunction, and
[23:44] Speaker 7: that process can be much more much up quicker than permanent.
[23:48] Speaker 7: It can get resolved within about four or five months.
[23:50] Speaker 1: This is the Bloomberg Intelligence podcast, available on Apple, Spotify,
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