ECONOMY

Latest new updates: Biden inks temporary US funding deal

Zoom and cloud company Five9 abandon $14.7bn deal

Zoom Video Communications’ bid to buy the cloud software provider Five9 has collapsed just weeks after the US Department of Justice raised national security concerns over the $14.7bn deal and shareholders were advised to vote against the takeover by a powerful proxy group.

The companies announced on Thursday they had decided to terminate their agreement following a shareholder meeting organised by Five9 during which a majority of investors said they were against the deal.

“We had the opportunity to engage extensively with our shareholders since our transaction announcement. We greatly appreciate their feedback and confidence in Five9’s future prospects and share their views regarding the significant potential for value creation as a standalone company,” said Rowan Trollope, chief executive of Five9.

The decision to end the takeover is a blow to Zoom, which is hoping to expand its offerings following the enormous success of its video conferencing services during the pandemic. The deal with Five9 would have been its largest acquisition to date, but was marred by a struggling share price and regulatory concerns.

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Biden inks temporary US funding deal

President Joe Biden signed a temporary deal to avert a US government shutdown on Thursday evening, giving the government 9 weeks’ leeway to avoid a default.

The bill extends government funding until December 3 and suspends its debt limit until December 17, averting a government shutdown that would otherwise have begun on Friday.

The bill was passed by both chambers of Congress earlier on Thursday. It does not, however, make long-term provisions for raising the debt ceiling.

The measure comes in the wake of weeks of wrangling between Democrats and Republicans over increasing the limit to the amount of debt the federal government can take on, which is crucial to ensuring it can continue to fund itself. On Monday and Tuesday, efforts to raise and then suspend the debt ceiling were thwarted by Senate Republicans.

Treasury secretary Janet Yellen said that the US risked running out of money if it did not raise the limit by October 18.

The day ahead …

Eurozone inflation figures September inflation data due today is expected to reach a 13-year high, boosted by surging energy costs and strong demand as economies reopened.

Japan unemployment rate August jobless figures will be released today. With economic policy support for businesses, Prime Minister Yoshihide Suga was able to keep unemployment relatively low during the pandemic. His successor, Fumio Kishida, will be tested on this front.

Manufacturing PMIs Gauges of manufacturing activity for Spain, Italy and the UK in September will all be released today. UK manufacturing is expected to continue to expand, but at a slower rate than in August.

More UK data The Office for National Statistics will release quarterly business investment figures, Q2 balance of payments, quarterly economic accounts and quarterly consumer trends data today.

The weekend will see the start of UK Black History Month and the beginning of the Conservative party conference.

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