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Western Digital shares up 10% on memory chip merger reports

In today’s top stories, a slump in demand for memory chips is reportedly pushing Western Digital to accelerate merger talks with Kioxia Holdings. Meanwhile, Newmont has announced it’s to acquire Australian gold miner Newcrest, while gas industry giant Oneok has agreed to buy Magellan Midstream Partners in a deal that will create one of the largest pipeline operators in the US. Elsewhere, Vice Media Group has filed for Chapter 11 bankruptcy protection, and OpenAI CEO Sam Altman is close to securing $100m for his crypto project, Worldcoin. 

Newmont and Newcrest agree deal

After months of talks, the world’s largest gold miner Newmont [NEM] has announced it’s to acquire Australian gold miner Newcrest [NCM.AX] for A$26.2bn, with the deal expected to be finalised in the fourth quarter. The two companies will have approximately eight million ounces of combined annual gold production once the transaction closes, according to a statement. This would be almost double the 2022 output of Newmont’s nearest rival Barrick Gold [GOLD].

Western Digital accelerates merger talks

A slump in demand for memory chips is pushing the industry’s second-biggest player, Western Digital [WDC], to accelerate merger talks with the industry’s fourth-biggest player, Kioxia Holdings, Reuters reported Monday. Kioxia would own a 43% majority of the new entity, with Western Digital owning 37% and existing shareholders of the two companies owning the rest. A deal would likely attract the ire of antitrust regulators in a number of countries, however. The Western Digital share price was up almost 10% in premarket trading.

Vice files Chapter 11

Digital media publisher Vice Media Group has filed for Chapter 11 bankruptcy protection. The company was valued at $5.7bn in 2017, but is now preparing to sell its assets for less than $1bn. Speaking to the BBC, Joseph Teasdale, head of technology at Enders Analysis, said: “The issue with Vice and all similar websites is that they never really worked out a business model for free online journalism.”

OpenAI CEO’s crypto project

OpenAI CEO Sam Altman is close to securing $100m in funding for his crypto project, Worldcoin. The project, founded by Altman and Alex Blania back in 2019, plans to use iris-scanning technology for identity verification to access the digital currency. Considering it is a bear market, and given recent contagion from the FTX collapse, it is “remarkable for a project in this space to get this amount of investment”, a source told the Financial Times.

Oneok and Magellan in $18.8bn pipeline deal

Gas industry giant Oneok [OKE] has agreed to buy Magellan Midstream Partners LP [MMP] for $18.8bn in a cash-and-stock deal that will create one of the largest pipeline operators in the US. “We see this as a bold move to redirect the long-term strategy of both companies,” wrote Raymond James analysts JR Weston and Justin Jenkins in a note seen by Bloomberg, adding that they’re “fans of consolidation in midstream”. The Oneok share price was down nearly 7% premarket.

 

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