Tires, Tensions & Takeovers

Why Pirelli is squeezing China to stay in America’s good books.

March 27, 2025

Suit & Times Daily Briefing – March 27, 2025

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What We're Covering Today

  • 🛞 Pirelli Pushes for Smaller Sinochem Stake – Italian tire giant urges Chinese shareholder to reduce its ownership amid U.S. regulatory concerns.

  • 🤖 CoreWeave IPO Faces AI Hardware Challenge – The startup backed by Nvidia confronts rapid technological obsolescence ahead of its market debut.

  • 🏛️ UBS Negotiates Capital Concessions – The Swiss banking giant proposes regulatory compromises following its Credit Suisse merger.

  • ⚖️ Jenner & Block Challenges Trump Administration – Prominent law firm defies executive order targeting attorneys linked to political investigations.

  • ⚾ Angels Sign Veteran Infielder Nicky Lopez – Los Angeles Angels enhance roster flexibility with strategic player acquisition.

📈 The Ledger

Tracking key market indexes to give you a pulse on global financial movements. 

As of close March 26, 2025

These indexes cover U.S. markets, global equities, small-cap stocks, volatility, and economic trends, offering a snapshot of where the market is heading.

🔹 Why These Indexes Matter:

  • Broad Market Trends: The S&P 500, Dow Jones, and Nasdaq show how major U.S. companies are performing.

  • Volatility & Risk: The VIX measures market uncertainty and investor sentiment.

  • Global Perspective: FTSE 100, Nikkei 225, and MSCI World reflect international market health.

🧱 Business: Pirelli Pushes Sinochem to Reduce Stake Amid U.S. Expansion Concerns

The Story: Italian tire powerhouse Pirelli is urging its largest shareholder, China’s Sinochem, to reduce its ownership below that of Italian stakeholder Camfin, which currently holds a 26.4% stake. This strategic move is seen as a proactive step to ease heightened U.S. regulatory anxieties, especially in a climate where the Biden-Trump handoff has only amplified scrutiny on foreign—particularly Chinese—ownership. For Pirelli, with the U.S. positioned as a major growth engine, keeping regulators calm is essential to long-term American ambitions.

Key Insights:

  • Stake Rebalance: A lower Sinochem share would grease the wheels for U.S. regulators, smoothing approvals for future expansion and deals.

  • Geopolitical Backdrop: Tensions between the U.S. and China, inflamed under both Biden and Trump administrations, make any Chinese majority stake a political flashpoint.

  • Buyback Under Review: Talks are ongoing for a potential share buyback to reduce Sinochem’s holding below 25%, though nothing is finalized yet.

💹 Finance: CoreWeave's IPO Faces Potential Hardware Depreciation Challenges

The Story: AI cloud player CoreWeave, heavily backed by Nvidia, is preparing for an IPO amid serious valuation headwinds. Why? Nvidia’s new Blackwell chips could make CoreWeave’s current hardware, based on the now-outdated Hopper GPUs, look ancient overnight. With AI infrastructure evolving at breakneck speed, tech depreciation is more than an accounting line item—it’s a threat to investor confidence.

Key Insights:

  • AI Hardware Whiplash: CoreWeave’s massive investment in older GPUs could weigh down its future earnings outlook.

  • Industry-Wide Caution: Big names like Amazon and Google face similar risks—this isn’t a CoreWeave problem, it’s an AI sector problem.

  • Adjusting Expectations: Like Amazon’s infrastructure strategy, CoreWeave may need to recalibrate forecasts to account for steeper hardware obsolescence curves.

🏦 Finance: UBS Proposes Concessions to Swiss Regulators Post Credit Suisse Acquisition

The Story: UBS is navigating the regulatory gauntlet after swallowing up rival Credit Suisse, and it's coming to the table with some serious offers. The Swiss bank is proposing a 30% cap on its investment banking division and phasing in capital increases to align with Swiss oversight expectations—all while trying to keep its global competitive edge intact.

Why It Matters:

  • Avoiding a $40B Shock: Regulators are eyeing a capital hike that could cost UBS up to $40 billion.

  • Balancing Act: The proposed limits on investment banking help reduce systemic risk without neutering UBS’s global ambitions.

  • HQ Switch? Relocation has been floated—but there's no official exit strategy from Switzerland (yet).

⚖️ Politics: Jenner & Block Resists Trump's Actions Against Major Law Firms

The Story: In a bold move, law firm Jenner & Block is pushing back against a controversial executive order by former President Donald Trump, which strips security clearances from attorneys involved in politically charged investigations. This includes high-profile names like Andrew Weissmann, a lead investigator in the Mueller probe.

Key Takeaways:

  • Chilling Legal Precedent: The order could undermine legal independence by targeting firms involved in politically sensitive cases.

  • Firm's Defiance: Jenner & Block publicly reaffirmed its mission to serve clients without bending to political pressures.

  • Broader Fallout: The order is already drawing constitutional scrutiny from legal scholars and civil liberty groups.

⚾ Sports: Angels Sign Veteran Infielder Nicky Lopez

The Story: The Los Angeles Angels have picked up Nicky Lopez, signing the versatile infielder to a one-year, $850,000 deal. With injury clouds hanging over the roster, Lopez brings a welcome dose of stability and flexibility to the Angels' infield.

Key Player Stats:

  • Breakout Season: Hit .300 with 22 stolen bases for the Royals in 2021.

  • 2024 Recap: Played 124 games with the White Sox, batting .241 with 21 RBIs.

  • Utility Asset: Can comfortably play both second base and shortstop—crucial for a team managing health risks.

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💡 That’s it for today’s briefing. Stay sharp, stay informed, and we’ll see you tomorrow!