DoorDash IPO Pricing Is Said to Value Company at $39 Billion: Live Updates

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Senate Coronavirus Relief Negotiations Stall

Senator Mitch McConnell, the majority leader, on Tuesday offered to drop his demand for liability protections if Democrats would forego aid to states and local governments. Senator Chuck Schumer, the minority leader, rejected the offer.

“My view, and I think it’s a view shared by literally everybody on both sides of the aisle, is we can’t leave without doing a Covid bill. The country needs it. We have an agreement that we need to do this. We know the new administration is going to be asking for another package. What I recommend is we set aside liability and set aside state and local, and pass those things that we can agree on knowing full well we’ll be back at this after the first of the year.” “Now, Senator McConnell has put the jobs of firefighters, ambulance workers, sanitation officers, police officers in jeopardy. Every governor and mayor across the country has been fighting to keep these people working. And McConnell is pulling the rug out from under them. Leader McConnell has refused to be part of the bipartisan negotiations, and now he’s sabotaging good-faith bipartisan negotiations because his partisan ideological effort is not getting a good reception.”

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Senator Mitch McConnell, the majority leader, on Tuesday offered to drop his demand for liability protections if Democrats would forego aid to states and local governments. Senator Chuck Schumer, the minority leader, rejected the offer.CreditCredit…Anna Moneymaker for The New York Times

Leaping back into negotiations over coronavirus relief, the White House presented Democrats on Tuesday with a $916 billion stimulus proposal that would meet their demand of sending money to state and local governments while also including liability protections for employers that are a top priority of Republicans.

The offer laid out by Steven Mnuchin, the Treasury secretary, was the first time since November’s election that the Trump administration has engaged directly in talks on Capitol Hill over how to prop up the nation’s flagging economy. But it was far from clear how it would be received as lawmakers continued to haggle over both the state and local aid and over the legal protections for businesses, universities and schools.

Mr. Mnuchin outlined his plan to Speaker Nancy Pelosi of California in a 5 p.m. call, and said he had also shared the proposal with the top Republicans, Senator Mitch McConnell of Kentucky, the majority leader, and Representative Kevin McCarthy of California, the minority leader.

“I look forward to achieving bipartisan agreement so we can provide this critical economic relief to American workers, families and businesses,” Mr. Mnuchin said in a statement.

He shared few other details about the proposal, which was slightly larger than one developed by a bipartisan group of senators who helped jump-start stalled negotiations last week by presenting a $908 billion compromise. Mr. Mnuchin proposed using $140 billion in unused funds from the Paycheck Protection Program, a small business loan program, and another $429 billion in Treasury Department funds to offset the cost.

The offer came near the end of a whipsaw day of negotiations on Capitol Hill, where lawmakers were racing to reach an agreement before they left town for the holidays and adjourned for the year.

Just hours earlier, Mr. McConnell had signaled that he would be willing to drop his demand for the sweeping liability shield — which he has called a “red line” for a stimulus plan — provided that Democrats would abandon their insistence on including billions of dollars in aid for state, local and tribal governments.

Democrats immediately dismissed Mr. McConnell’s suggestion as a nonstarter, but it was the first offer of a major concession since congressional leaders agreed last week to renew their efforts to reach a deal on another round of coronavirus relief before they conclude this year’s session.

“We know the new administration is going to be asking for another package,” Mr. McConnell said on Tuesday, offering a tacit acknowledgment of President-elect Joseph R. Biden Jr.’s victory. “What I recommend is we set aside liability, and set aside state and local, and pass those things that we agree on, knowing full well we’ll be back at this after the first of the year.”

Democrats panned the idea, after months of insisting that any stimulus agreement include funds to bolster state and local governments that have lost hundreds of billion of dollars during the pandemic and are facing devastating budget cuts. Republicans have branded the provision as a “blue-state bailout,” though state officials in both parties have lobbied for additional relief.

“He’s sabotaging good-faith bipartisan negotiations because his partisan ideological effort is not getting a good reception,” said Senator Chuck Schumer of New York, the minority leader, charging that “Senator McConnell is trying to pull the rug out from beneath” lawmakers working to hash out an agreement.

Mr. Schumer said Democrats’ proposals for funding state and local governments had “broad bipartisan support,” unlike Mr. McConnell’s liability proposal. But some liability protections are included in the negotiations among the bipartisan group of senators working on a compromise plan, which Democratic leaders said should be a starting point for negotiations.

A DoorDash delivery worker in Manhattan. The company will begin trading on the New York Stock Exchange on Wednesday under the symbol “DASH.”
Credit…Sean Sirota for The New York Times

DoorDash, the country’s largest food delivery company, plans to price its shares at $102 each on Tuesday, according to a person with knowledge of the situation, raising roughly $3.4 billion in its initial public offering and valuing the company at around $39 billion.

DoorDash had already raised its price range amid demand from potential shareholders as it prepares to begin trading on the New York Stock Exchange on Wednesday under the symbol “DASH.” The company was last valued at $16 billion by private market investors.

The company is expected to publicly confirm the price Tuesday evening.

DoorDash’s I.P.O. is part of a parade of valuable start-ups rushing to go public before the end of the year. The ebullient stock market, driven in part by low interest rates and strong growth for tech companies, has made 2020 the busiest year for I.P.O.s since 1999.

The home rental start-up Airbnb is expected to price its shares on Wednesday and begin trading on Thursday. It also raised its proposed price range after indications of strong demand from investors.

Both DoorDash and Airbnb plan to use a new type of “hybrid auction” system to list their shares to prevent a share price “pop” on their first day of trading.

While the pandemic has ravaged parts of the economy, it has been a boon to many tech companies. People stuck at home have relied more on delivery services. DoorDash’s revenue more than tripled to $1.92 billion in the first nine months of the year compared to $587 million in the same period last year, though it said that growth was likely to slow in the future. The company is unprofitable.

Based in San Francisco, DoorDash has more than 18 million customers and one million drivers. It has recently expanded beyond food delivery into groceries, pet food and convenience store items.

The Wall Street Journal earlier reported DoorDash’s offering share price.

Rolls of steel at a manufacturing plant in Baytown Tex. Britain will impose tariffs on American aluminum and steel in retaliation for President Trump’s decision to place levies on metals from Europe and elsewhere.
Credit…David J. Phillip/Associated Press

Britain said Tuesday that it would impose retaliatory tariffs on American aluminum and steel imports when it separated from the European Union on Jan. 1, but that it had decided to forgo any tariffs against the United States as part of a long-running trade dispute over aircraft subsidies.

The decision comes as Britain prepares to take over control of its own trade policy as it departs the European Union. The moves are an attempt to calm trade tensions with the United States and pave the way for their future trading relations, the British government said.

“Ultimately, we want to de-escalate the conflict and come to a negotiated settlement so we can deepen our trading relationship with the U.S. and draw a line under all this,” Liz Truss, Britain’s international trade secretary, said in a statement. “We are protecting our steel industry against illegal and unfair tariffs — and will continue to do so — but are also showing the U.S. we are serious about ending a dispute that benefits neither country.”

The tariffs on American aluminum and steel would be imposed in retaliation for President Trump’s decision in 2018 to place levies on metals from Europe and elsewhere. The European Union has already imposed retaliatory tariffs on American goods like steel bars, whiskey and orange juice, but with Britain now separating from the bloc, it will impose its own tariffs.

The United States and Europe have also placed tariffs on each other in response to twin trade cases at the World Trade Organization over airplane subsidies. One trade case authorized the United States to tax European goods to recoup losses sustained from subsidies the European Union provided to Airbus, while another case allowed Europe to put tariffs on the United States in response to subsidies given to Boeing.

Both sides have said they are interested in negotiating a settlement.

In its announcement, the British government said it would begin a process to consult with British businesses and ensure its tariffs on American metals were tailored to the British economy.

It said that it was suspending the Boeing tariffs “in an effort to bring the U.S. toward a reasonable settlement and show the U.K. is serious about reaching a negotiated outcome,” but that it reserved the right to impose tariffs again if such a compromise could not be reached.

The Senate on Tuesday confirmed a Trump administration lawyer to the Federal Communications Commission, a move that critics say could leave the agency deadlocked early next year as it confronts the digital divide widened by the pandemic.

Lawmakers voted 49-46 to approve the nomination of Nathan Simington, a Commerce Department lawyer who previously worked for the private sector. His confirmation to a five-year term makes it likely that the agency will be evenly divided by party during the first days of President-elect Joseph R. Biden Jr.’s administration.

The agency’s chairman, Ajit Pai, a Republican, has said he will leave on Inauguration Day. That would leave the balance of the commission at two Republicans and two Democrats, making it difficult for Democrats to move forward with their agenda until Mr. Biden’s nominee is confirmed.

Senator Richard Blumenthal, a Connecticut Democrat, said that the confirmation would leave an agency “that is gridlocked and dysfunctional” as it votes on proposals and would be a boon to major media and telecommunication companies.

Mr. Simington’s nomination has also been contentious because this year he worked on a petition by the Commerce Department that asked the F.C.C. to limit legal protections for social media platforms. Critics of Mr. Simington’s nomination worry that it is part of Mr. Trump’s larger campaign against the law, known as Section 230, set off by frustration with how social media platforms handle his posts.

The Federal Trade Commission is suing to block Procter & Gamble’s proposed acquisition of Billie, a direct-to-consumer company that sells women’s razors and body care products.

The F.T.C., whose responsibilities include enforcing antitrust law, said on Tuesday that the deal would allow Procter & Gamble, the leading supplier of wet-shave razors, to eliminate competition, which would drive up prices for women’s shaving products.

“As its sales grew, Billie was likely to expand into brick-and-mortar stores, posing a serious threat to P.&G.,” Ian Conner, director of the commission’s Bureau of Competition, said in a statement.

Procter & Gamble announced the purchase in January.

This is the second antitrust lawsuit filed by the F.T.C. this year to block an acquisition in the direct-to-consumer razor market. In February, the agency blocked Edgewell Personal Care from acquiring Harry’s, a subscription service offering men’s shaving products.

Elon Musk in May called restrictions put in place in California to stop the spread of the virus “fascist.”
Credit…Michael Nagle for The New York Times

Elon Musk threatened in May to move Tesla to Texas, from California, where he has feuded with local officials about coronavirus restrictions.

Now he claims to have pulled the trigger, at least for himself.

Mr. Musk said on Tuesday that he had moved to be near a new factory Tesla is building outside Austin. Speaking at a conference hosted by The Wall Street Journal, he said California has become less accommodating to successful entrepreneurs and start-ups, comparing the state to a sports team that takes winning for granted.

“They do tend to get a little complacent, a little entitled, and then they don’t win the championship anymore,” he said.

Mr. Musk clashed with public health officials in California over measures put in place to slow the spread of the coronavirus, which included shutting down car production at Tesla’s factory in Fremont, a city in the San Francisco Bay Area. He called restrictions to stop the spread of the virus “fascist” and predicted in March that there would be almost no new cases of the disease by the end of April.

He also announced in May that he would be “selling almost all physical possessions,” including his homes, and later listed for sale several homes he owned in California.

Speculation about a move by Mr. Musk or Tesla to Texas had increased in recent weeks. In addition to the Austin plant Tesla is building, Mr. Musk is also frequently drawn to Texas by his other company, SpaceX, which has substantial operations in the state, including a launch site on the Gulf of Mexico.

Patrick Gaspard has emerged as the leading candidate to be nominated as labor secretary under President-elect Joseph R. Biden Jr.
Credit…Ernesto Distefano/Getty Images

Patrick Gaspard, a former aide to President Barack Obama, U.S. ambassador to South Africa and executive director of the Democratic National Committee, has emerged as the leading candidate to be nominated as labor secretary under President-elect Joseph R. Biden Jr., according to people with knowledge of the discussions.

Mr. Gaspard announced last week that he would step down as the head of the Open Society Foundations, founded by the liberal megadonor George Soros, at the end of the year, fueling speculation in Washington that he was poised to join the incoming administration. He has a background in labor organizing, including a senior leadership position for the Service Employees International Union, which he held before joining the Obama administration.

His potential nomination would give Mr. Biden, who calls himself a “union guy,” a labor secretary with union roots. He would also add to the list of Black cabinet appointees, a key goal of Mr. Biden’s transition team as it seeks to fulfill Mr. Biden’s campaign promise of diversity in the top leadership of his administration.

Born in the Democratic Republic of Congo to Haitian parents, Mr. Gaspard immigrated to the United States in early childhood, grew up in New York and attended Columbia University before leaving to work on Jesse Jackson’s 1988 presidential campaign. He worked for years in New York City politics and on Howard Dean’s 2004 Democratic presidential bid, and he was an aide to former Mayor David Dinkins. After Mr. Dinkins died last month, Mr. Gaspard wrote on Twitter, “He taught me that you don’t need to be loud to be strong.”

Mr. Gaspard worked for years as an organizer and rose through the Service Employees International Union to become its national political director before joining Mr. Obama’s 2008 presidential campaign. In the Obama White House, Mr. Gaspard served as director of political affairs, before helming the Democratic National Committee and being confirmed as Mr. Obama’s ambassador to South Africa.

Two other possible nominees appear to remain in contention for Labor secretary. One is Julie Su, a labor lawyer and MacArthur “genius” grant recipient who is the secretary of California’s Labor and Workforce Development Agency. The other is Boston Mayor Marty Walsh, who has won support from some key labor unions.

Allies of Senator Bernie Sanders, independent of Vermont and Mr. Biden’s chief rival for the Democratic nomination this year, had pushed hard for Mr. Sanders to be selected as labor secretary. But Mr. Biden’s short list for the job does not appear to include Mr. Sanders.

Boeing 737 Max aircraft in a lot at Boeing Field in Seattle. The plane was grounded worldwide almost two years ago.
Credit…Lindsey Wasson/Reuters

Gol Airlines, a Brazilian carrier, said it planned to start flights aboard the Boeing 737 Max on Wednesday, making it the first airline to fly passengers on the plane since it was grounded worldwide almost two years ago.

The first flights will be on domestic routes to and from Gol’s hub in São Paulo, with the company expecting all seven of the Max planes in its fleet to be updated and cleared to fly by the end of the month. A Gol spokeswoman declined to provide further details.

“Our first priority is always the safety of our customers,” Celso Ferrer, vice president of operations and a commercial pilot at Gol, said in a statement. “Over the past 20 months, we have watched the most comprehensive safety review in the history of commercial aviation unfold.”

The Max was banned worldwide in March 2019 after a total of 346 people were killed in two crashes aboard the plane. In the United States, the Federal Aviation Administration last month became the first regulator to allow the plane to fly again, after required modifications are made. The agency was recently joined by regulators in Brazil, while the European aviation authority has suggested that it plans to lift its ban within weeks. Relatives of those killed in the crashes criticized the decision to allow the plane to fly again, arguing that it remains unsafe.

The lifting of the ban allows Boeing to restart sales and deliveries in earnest after its passenger airline business was pummeled by the grounding and the pandemic. The plane maker on Tuesday reported a net decline of 61 orders last month. Boeing’s backlog of orders, most of them for the Max, stood at 4,240, down more than a thousand from the start of the year after accounting for fulfilled orders.

Still, airlines are still interested in acquiring the plane. Last week, the company announced it had agreed to sell 75 Max jets to Ryanair, the low-cost European airline. Like RyanAir, Gol is among the biggest customers for the Max. The airline’s fleet is composed of 127 Boeing planes and it has an order for 95 Max jets scheduled for delivery over a decade starting in 2022.

Brian Chesky, Airbnb’s co-founder, in 2018. It’s usually not regular people, employees or even pre-I.P.O. investors who get a windfall from initial public offerings.
Credit…Eric Risberg/Associated Press

A dirty secret of initial public offerings is that even the coolest ones may make only a handful of people rich — and it may not be regular people, employees or even fancy pre-I.P.O. investors who get a windfall.

DoorDash and Airbnb are expected to have spectacular first sales on public stock exchanges this week and start trading at far higher levels than anticipated even a few weeks ago.

But buying stock in relatively young and unproven companies — which usually describes technology companies selling their stock to the public for the first time — is often a coin-toss bet. Even the professional investors who buy stock in hot companies before they go public don’t always get rich, unless they throw their money around early and get lucky. Companies you might have heard of like Uber, Lyft, Snap and Slack were at best meh I.P.O. investments.

Look at Airbnb. Among the investors who got a special chance to buy Airbnb stock nearly four years ago, each $10,000 of stock they bought will be worth about $11,500 if Airbnb starts selling its shares to the public for $60 each. Nice!

But if your aunt had invested $10,000 nearly four years ago in a simple fund that mirrored the ups and downs of the S&P 500 stock index, she would now have $15,600. Even nicer.

The pandemic hurt business for Uber and Lyft, but their stocks were losers before then. Uber’s stock price has bounced back and is now up 30 percent since the spring, and still anyone who bought Uber shares in its 2019 I.P.O. — and even the professional investors who bought its stock in the four years before that — would have made far more money buying an index fund. Uber employees who were hired before the I.P.O. and were paid partly in stock also would have been better off being paid in an index fund.

People who bought stock in Snap, the company behind Snapchat, in its 2017 initial public offering had to wait more than three years to not lose money on their bet. Slack just sold itself at a share price not much higher than its first public stock sale last year.

These are cherry-picked examples. There are companies whose stock prices have soared since their I.P.O.s and made people rich — Zoom Video is a prominent example in technology. And the people who have already bet on the restaurant delivery app DoorDash stand to make a big profit when the company goes public this week.

Will Airbnb be a winning I.P.O.? It depends. It definitely will be for the venture capital firm Sequoia, which bet on Airbnb early. And it’s certainly faring better than people expected when travel froze early this year. But no one can confidently predict whether its share price will shoot to the moon like Zoom’s has since its 2019 I.P.O. or will plunge as Lyft’s did after it went public.

That’s the lesson. Cool companies don’t always make good investments. The people screaming on Robinhood about their splurge on a hot I.P.O. may not know what they’re talking about.


By: Ella Koeze·Source: Refinitiv

  • Stocks were unsteady on Tuesday, as the spread of coronavirus cases and restrictions on people’s movement and businesses outweighed optimism about the rollout of a vaccine.

  • The S&P 500 rose about a quarter of a percent. The Stoxx Europe 600 and Britain’s FTSE 100 also recouped small losses and were slightly higher.

  • In the United States, rising numbers of virus cases has led California to impose new stay-at-home orders in large swathes of the state. In New York, the number of people hospitalized with the coronavirus is rising and could lead to another ban on indoor dining.

  • In Europe, countries are struggling to emerge from a second wave of the pandemic. The infection rate in France is threatening plans to ease restrictions before the holidays, and in Greece, the lockdown was extended until early January.

  • But on a brighter note, Britain on Tuesday started a mass vaccination campaign, delivering the first shots of the Pfizer-BioNTech Covid-19 vaccine. “There is finally some clear light at the end of a very dark tunnel,” James Pomeroy, an economist at HSBC, wrote in a note to clients. “And that cheer should be seen in some of the economic data in the coming year too.”

  • Tesla said on Tuesday it would sell as much as $5 billion in shares, its third return to markets in 10 months, and use the money for more investments including factory construction. Tesla’s shares ended the day up more than a percent. This year, the electric carmaker’s shares have risen about 670 percent, and later this month, the company will join the S&P 500.

Goods are piling up at some British ports, as trucks and rail have failed to keep up with companies trying to stockpile ahead of Brexit.
Credit…Andrew Testa for The New York Times

Businesses in Britain and the European Union are bracing for the economic disruption of Brexit, which threatens to clog ports and disrupt trade across the English Channel on Dec. 31 if leaders do not reach a compromise to settle their future trading relationship.

But the economic breakup could have a relatively limited impact on trade with the United States, trade experts said.

Because the United States does not have a free-trade agreement with the European Union, Britain’s departure from the bloc will do little to alter its trading relationship with the United States. Following Brexit, the terms of trade between the United States and Britain will continue to be governed by the rules of the World Trade Organization, as they were before.

The direct effect on the two trade partners “should be minimal given there’s no change in tariffs,” said Christopher Rogers, a global trade and logistics analyst at Panjiva.

Still, he said, significant customs disruptions between Europe and Britain could have knock-on effects for supply chains, if, for example, it takes British businesses that are exporting to the United States longer to source components from abroad. Goods are piling up at some British ports, as trucks and rail have failed to keep up with companies trying to stockpile ahead of Brexit.

Britain’s trading terms with the United States may not get much worse, but they also appear unlikely to get better.

The two countries have been carrying out negotiations for a free-trade deal since May. But with the election of Joseph R. Biden Jr., the prospects for that agreement, which many Britons saw as a source of post-Brexit strength, have been greatly diminished.

The congressional authority that gives trade deals an easier path to approval by Congress, called trade promotion authority, is set to expire this summer, and Mr. Biden has promised not to enter into any major new trade agreements until the United States has made major investments at home.

Google’s offices in London. Britain’s top antitrust regulator recommended a new tech watchdog.
Credit…Ben Stansall/Agence France-Presse — Getty Images

Governments around the world have been grappling with ways to crimp the power of the biggest tech companies. In the United States, the Justice Department recently filed an antitrust case against Google. The European Union has issued antitrust violations and enacted stiffer data-protection laws. The Australian government is pushing new rules to make Google and Facebook pay for certain content.

But many question whether the tactics are adequate, particularly if a lengthy enforcement and legal process slows down action against the fast-moving and deep-pocketed companies.

On Tuesday, Britain’s top antitrust regulator recommended a new approach. The Competition and Markets Authority released recommendations for creating a new regulator called the Digital Markets Unit that will focus on the biggest technology platforms. The regulator would be able to fine companies up to 10 percent of global revenue.

The idea of creating a tech industry regulator has gained momentum among academics and policymakers around the world. The aim is to treat giants like Amazon, Apple, Facebook, Google, and Microsoft more like the biggest companies in banking and health care — with dedicated regulators that have the expertise in the subject matter to serve as a watchdog and act quickly to address wrongdoing, akin to the Securities and Exchange Commission and the Food and Drug Administration.

Britain is perhaps the furthest along. The new regulator would be responsible for enforcing a legally binding code of conduct intended to prevent the biggest companies from using their dominance to exploit consumers and business, or to box out emerging competitors. Officials said only companies of a certain size would fall under the rules, which would be tailored to specific types of businesses. Google and Facebook may face certain restrictions related to digital advertising, while Amazon would have others related to e-commerce.

To improve competition, the regulator could force companies to share certain data with rivals, and it would review acquisitions.

The proposals build on recommendations made by a British panel of experts last year and are part of a process by the government to enact regulations for the digital economy by next year. Britain is preparing to leave the European Union, which next week will release its own draft laws to increase oversight of the tech industry across the 27-nation bloc.

British authorities have raised specific concerns about the digital advertising market dominated by Google and Facebook. In July, the Competition and Markets Authority published a 437-page investigation that concluded the two companies have such scale and unmatched access to user data that “potential rivals can no longer compete on equal terms.”

Goldman Sachs has reached a deal to buy out the minority partner in its Chinese securities joint venture, which could make it the first global bank to assume full ownership of its securities business in mainland China since the Communist Party took control of foreign-owned enterprises in the country in the 1950s.

In a memo to employees on Tuesday, the Wall Street bank said it had reached a definitive agreement to buy a 49 percent stake in Goldman Sachs Gao Hua still held by its local partner, Beijing Gao Hua Securities. Goldman Sachs did not disclose a price for the transaction.

The deal follows a pledge by Chinese leaders in 2017, amid worsening trade relations with the United States, to relax or remove limits on foreign bank ownership. The move was part of an unsuccessful effort by China to enlist Wall Street in heading off President Trump’s plans to impose tariffs on Chinese goods.

Goldman Sachs could be the first to take full control of its China securities business, depending on regulatory approval and how quickly the deal is completed.

JP Morgan Chase already has full ownership of its futures business in China, but still has a joint venture for other activities on the mainland. Other investment banks, like JP Morgan Chase, Morgan Stanley, UBS and Nomura, are in various stages of raising their stakes in their Chinese securities operations.

Commercial banks, by contrast, have avoided raising their stakes in commercial banking operations in mainland China above 25 percent. Doing so would subject those operations to further global banking regulations.

Goldman Sachs had announced on March 27 that it had obtained regulatory approval to raise its stake in Goldman Sachs Gao Hua from 33 percent to 51 percent. Tuesday’s memo was reported earlier by The Wall Street Journal.

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