☕️ Generating new AI

Good morning.

The EU is revelling in the passing of the AI Act over the weekend - sweeping new regulations for use of the technology - which together with other developments could breathe new life into a sector so far dominated by OpenAI.

Not only has OpenAI’s partnership with Microsoft caught the eye of antitrust regulators in the UK and US, but its headline-nabbing competitors are also steadily making inroads. French generative AI firm, Mistral, today confirmed a US$414 million ($631.39 million) Series A round led by a16z, locking in a whopping US$2 billion valuation.

With Google’s Gemini and Germany’s Aleph Alpha also chasing down OpenAI’s turf, it looks like the AI battleground is set for fierce competition in 2024.

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Market movers

Kin Group’s upped bid to buy out Pact Group saw the packaging manufacturer’s stock jump a hefty 22.6% Monday, to trade at Kin’s new bid price of 84c. Kin Group currently owns 52.67% of the company, and both Pact’s independent board committee and Investors Mutual (a 5.5% significant holder) is reportedly recommending that shareholders accept the all-cash final offer.

The offer is due to be packaged up in time for Christmas on 21 December.

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The quick sync

• Smaller banks struggle to compete with Australia’s big four on home loans, the competition tribunal heard during week two of the ANZ-Suncorp appeal. (Capital Brief)

• Morgan Stanley has been appointed by Global Power Generation Australia to review options ahead of a potential 2024 sale. (AFR)

• Occidental Petroleum will acquire CrownRock for US$11 billion in yet another energy consolidation deal for 2023. (Wall Street Journal)

• COP28’s draft climate agreement fails to require phaseouts of fossil fuels from signatories. (Financial Times)

• Cigna calls off pursuit to merge with Humana in what would have created a US$140 billion health insurance giant, opts for share buybacks instead. (Reuters)

• Goldman Sachs economists expect the Fed to start cutting rates in H2 2024, and recommend “buying the dip” if the market trades down before then. (Bloomberg)

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Trading floor

M&A

• Anacacia Capital engages Allier Capital for RP Infrastructure sale. (AFR)

• 4DMedical is set to acquire US medtech Imbio in a deal valued at up to $68.4m. (BNA)

• Intermediate Capital Group, Medibank-Macquarie consortium, and Partners Group are set to submit bids for Cura Day Hospitals. (AFR)

• PNG government emphasises conditions for Woodside-Santos merger support. (AFR)

• Chemist Warehouse and Sigma are confident in resolving regulatory concerns over the $8.8bn merger. (SMH)

• Pendula and Whispir continue talks over a potential takeover offer. (AFR)

• It’s a crucial week for the $700m+ Perth Airport stake sale by The Infrastructure Fund and Australian Retirement Trust via UBS. (The Australian)

CAPITAL MARKETS

• CMA seeks input on the OpenAI-Microsoft partnership for potential competition concerns. (Capital Brief)

• Chemist Warehouse eyes international expansion post ASX listing. (AFR)

VC

• Microbiome-focused scalp care brand STRAAND raises $4m for international expansion. (Smart Company)

• SourseAI raises $3m in Series A for European expansion led by Centerstone Capital. (Startup Daily)

• Property tech firm Blockbuilder has secured $2m and aims to raise $2m more for the launch of its cashless deposit platform in the UK and US. (AFR)

• Cyban has successfully closed a $6.25m Series A funding round. (Capital Brief)

• Blackbird Ventures leads a $4.15m funding round for Clove. (AFR)

• Melbourne startup secures $1m in pre-seed funding for B2B retail transformation. (BNA)

• Bupa supports six startups in Australia and New Zealand through Eco Disruptive program. (Startup Daily)

People moves

• Shaw and Partners hires three advisers from Macquarie. (AFR)

• Kathleen Conlon is to succeed Anthony Kiernan as chair of Pilbara Minerals next year. (Capital Brief)

• Wilsons Advisory hires veteran banker Jon Gidney as senior adviser. (AFR)

The watercooler