Smartkarma Daily Briefs

• ZEEKR (ZK US) has entered into a definitive merger agreement with Geely Auto (175 HK) at US$26.87 per ADS or 12.3 newly issued Geely shares. The cash offer increased by 4.7%. 
• The proposal is conditional on regulatory approvals (low risk, as Zeekr is a subsidiary of Geely), as well as approval from Zeekr’s shareholders and Geely’s independent shareholders.  
• The Zeekr shareholder vote is a formality as Geely and undertakings exceed the two-thirds voting threshold. The Geely vote is low risk due to the low takeover premium. 

• The merger between Synopsys Inc (SNPS US) and Ansys Inc (ANSS US) marks a major industry milestone, having overcome extended regulatory hurdles, including a delayed approval from Chinese authorities.
• Ansys Inc (ANSS US) shareholders will receive $197 cash plus 0.3450 Synopsys Inc (SNPS US) shares per Ansys Inc (ANSS US) share, valuing the deal at about $35 billion.
• The merger is expected to significantly impact major U.S. indexes, triggering intra-quarter replacements and substantial passive fund flows.

• US – China: Restrictions on Semiconductors are relaxed. EDA tool (Cadence, Synopsys) already relaxed, Nvidia says export license will come, this implies that HBM can be sold to China.     
• It’s really hard to “guess” what comes next as US restrictions on technology export to China are just one bargaining tool in much broader negotiations (trade deficit, fentanyl, etc).   
• For Cadence and Synopsys, China is 12% of revenues. For Nvidia, China is US$ 30-35bn revenue in 2025 (15-17%).  Positive to Samsung, supplying HBM3 (Nvidia’s H20), GDDR7 (RTX PRO).

• Eli Lilly has firmly positioned itself at the forefront of the global anti-obesity drug race, fueled by its blockbuster GLP-1-based injectable Zepbound and an upcoming oral pill called orforglipron that could further cement its dominance.
• While rival Novo Nordisk’s Wegovy enjoyed a first-mover advantage, Lilly’s more effective compound tirzepatide rapidly seized control of the market, capturing 60% share and 75% of new treatment starts.
• Despite facing a setback with CVS’s recent formulary switch favoring Wegovy, Lilly continues to add approximately 500,000 new Zepbound patients each month and is expanding aggressively into international markets including India, China, and Mexico.

• Performance Food Group (PFG) has surged to the top of Wall Street chatter following reports that US Foods Holding Corp. is evaluating a potential acquisition of the company.
• According to people familiar with the matter, US Foods has expressed interest in merging with PFG in what would be a transformative deal for the food distribution industry.
• If completed, the combined entity would eclipse Sysco to become the largest foodservice distributor in the United States, commanding an estimated 18% market share of a $371 billion industry.

• Given the copper tariff announcement this week, it seemed worthwhile to sketch out where the US gets its copper from, as the situation is not nearly as dire as a 50% tariff makes it out to be.
• We think a little context goes a long way in this situation and leads us to believe that the tariff is a wholly unnecessary impediment to a well-functioning market.
• If Trump were serious about achieving self-sufficiency in copper, he would focus on permitting reform, as we have plenty of domestic copper and only lack the smelting/refining capacity.

• Schlumberger’s Q2 2025 revenue is expected to drop 6.8% YoY but rise by 0.4% QoQ. Similarly, its EPS is projected to drop 14.1% YoY but rise 1.4% QoQ.
• SLB’s Q2 performance looks weak as falling activity in Saudi Arabia and Latin America adds to the ongoing slowdown in North America.
• Open interest data points to cautious sentiment, with positioning skewed toward downside protection and no clear directional conviction.

• Accelerant Holdings is offering 28.947mm shares at $18.00-$20.00 equating to a market cap of $4.0b-$4.4b and is scheduled to debut on July 24th.
• As of June 30, 2025 they have 248 Members as compared to 186 Members as of June 30, 2024 (and 232 Members as of March 31, 2025).
• Given the positive tailwind from recent insurance-related IPOs as well as the strong metrics released in the company’s “flash numbers”, we believe this company could potentially be “well-received”. 

• Halliburton’s Q2 2025 revenue is expected to drop 0.2% QoQ and 7.2% YoY. Similarly, its EPS is projected to drop 6.7% QoQ and 30% YoY.
• SLB’s Q2 update highlights a slowdown in key international markets, potentially foreshadowing similar headwinds for Halliburton’s global operations.
• Options positioning and technical signals point to a neutral-to-bearish market stance ahead of Q2 results.

International Public Partnerships’ (INPP’s) recent portfolio update showed its portfolio is continuing to perform well, with further progress on accretive capital recycling. INPP shares offer an attractive prospective dividend yield of 7.0% with an unbroken record of dividend growth and visibility for at least another 20 years. Active measures to narrow the discount to NAV are having a positive impact, but it remains at c 15%, which in our view offers an attractive opportunity. At this level, the implied total return to an investor, based on projected future portfolio cash flows, is an attractive 10.1% per year, which is c 465bp above the UK 30-year gilt yield.