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INVESTORS GRABBING LAND FOR TRUCK DEPOTS OUTSIDE CITIES
With the U.S. short more than 70,000 truck drivers, real estate investors are locking up land outside cities as the prospect of self-driving trucks comes closer to reality.
Embark Trucks, which became a $5-billion public company last November, will launch its fleet of self-driving trucks in 2024 in California, Texas, and other Sunbelt states.
The trucks will carry cargo on highways, then turn control over to human drivers once the trucks reach close-in urban corridors.
Embark will need space close to cities to build hubs for switching drivers and storing vehicles, but available land near cities is as pricey as it is scarce: the boom in e-commerce has claimed many such sites for warehouses and zoning laws limit the spaces available as truck depots.
To secure those spaces, Embark has partnered with Alterra Property Group, a Philadelphia real estate investor.
Alterra will purchase the land Embark needs and then lease the property to Embark.
Other investors are hoping to cash in on the boom in consumers’ insatiable appetite for everything, which boosts demand for trucks hauling goods to metro areas.
JPMorgan Global Alternatives and Zenith IOS have partnered to invest $700 million in similar properties and had spent about $150 million by 1 March, The New York Times reported.
Cerberus Capital Management and Stonemont Financial Group have formed an alliance to do the same, the NYT said.
Outdoor storage yards and truck depots will see the same boom as single-family rental houses, Zenith IOS CEO Benjamin Atkins told the NYT.
As major property professionals start bundling the properties, pension funds and other institutional investors will buy in, driving prices higher, he predicted.
TD BUYS FIRST HORIZON FOR $13.4 BILLION
TD Bank Group of Canada is buying Memphis-based First Horizon Bank for $25 a share, 37 percent above First Horizon’s closing price on 4 March.
The deal will make TD Bank the U.S.’s sixth-largest lender, the Financial Times reported.
As part of the sale, First Horizon CEO Brian Jordan will become vice-chair of TD’s board and Leo Salom, TD’s chief of U.S. retail banking, will be the combined entity’s CEO.
TD has been aggressively buying its way into the U.S. banking business since 2004, when it bought Maine’s Banknorth. In 2005, it paid $1.9 billion to acquire Hudson United and shelled out $8.9 billion in 2007 to take over Commerce Bancorp.
Regulations have made it harder for larger U.S. banks to combine but left the way clear for Canadian financial firms to buy banks to their south.
At the same time, large American banks have sought to grow by subsuming smaller institutions.
In 2019, BB&T combined with SunTrust to create a major East Coast financial services firm. A year later, PNC Financial bought the U.S. business of Spain’s BBVA for $11.6 billion, making PNC America’s fifth-largest banking firm.
EPIC GAMES BUYS BANDCAMP MUSIC PLATFORM
Epic Games, creator of popular video games such as Fortnite and The Dark Prophecy, has acquired online music platform Bandcamp. Terms of the sale were not announced.
Bandcamp, less well known than Spotify or Youtube, has become a favorite among musicians: the platform gives creators greater control over how their music is distributed and gives them a greater share of resulting revenue than other venues have.
Creators collect 82 percent of the money from each Bandcamp sale and have been paid almost $1 billion since the platform opened in 2008, the company said.
In contrast, every time a song is clicked on Spotify, the service pays a third of a cent to be shared among music labels, publishers, and artists according to their agreements with each other.
On Bandcamp, musicians set their own terms.
Under Epic’s ownership, “Bandcamp will keep operating as a stand-alone marketplace and music community,” CEO Ethan Diamond wrote in a statement announcing the sale.
He assured musicians that “you’ll still have the same control over how you offer your music.”
Epic will help Bandcamp expand internationally and “push development forward,” he said.
Bandcamp will “play an important role in Epic’s vision to build out a creator marketplace ecosystem for content, technology, games, art, music, and more,” Epic’s statement said.
GOOGLE BUYS CYBERSECURITY FIRM FOR $5.4 BILLION
Google will pay $23 a share for Mandiant, an 18-year-old cybersecurity firm that will become part of Google’s cloud computing operation, in a deal valued at about $5.4 billion.
Mandiant’s market value was pegged at about $5.25 billion before the purchase was announced. The move will enlarge Google’s cloud efforts as it seeks to grow to compete with Amazon’s and Microsoft’s cloud presences.
The acquisition will be Google’s second-largest, following its $12.5-billion buyout of Motorola Mobility in 2012. Google sold its Motorola property in 2014 for $2.9 billion, a 75-percent loss.
“Organizations around the world are facing unprecedented cybersecurity challenges as the sophistication and severity of attacks that were previously used to target major governments are now being used to target companies in every industry,” Thomas Kurian, Google Cloud’s CEO, said in a statement announcing the transaction.
The deal is expected to close later this year.
Google’s purchase will have a “major ripple effect” in the cybersecurity industry, Wedbush analyst Dan Ives wrote in an 8 March note to investors.
“Cloud stalwarts Amazon and Microsoft will now be pressured into M&A and further bulk up its cloud platforms,” he predicted.