Business briefing

The daily business briefing: May 27, 2021

Amazon agrees to buy MGM studio in deal worth $8.45 billion, hedge fund wins seats on Exxon board in climate-change push, and more

1

Amazon agrees to buy MGM in $8.45 billion deal

Amazon said Wednesday it had agreed to buy MGM Holdings in a deal valued at $8.45 billion, including debt. The purchase is expected to provide a major boost to Amazon's Prime Video streaming platform by giving it the Hollywood studio's library of more than 4,000 films, including the James Bond and Rocky franchises. Amazon also will get classic films from The Silence of the Lambs to 12 Angry Men, as well as popular TV series, including The Handmaid's Tale and Fargo. "The acquisition's thesis here is really very simple," Amazon CEO Jeff Bezos said during a call with shareholders. "MGM has a vast, deep catalog of much-beloved intellectual property, and with the talented people at MGM and the talented people at Amazon Studios, we can reimagine and develop that IP for the 21st century."

2

Hedge fund wins 2 seats on Exxon board in climate-change push

The small hedge fund Engine No. 1 unseated two ExxonMobil board members on Wednesday in a push to force the energy giant to make changes to join the fight against climate change. The move came as investors increasingly express concerns that the energy industry isn't doing enough to change business strategies to address global warming. Eight of Exxon's nominees were elected to spots on the 12-member board, as were two Engine No. 1 nominees. "It's a huge deal … it's a rebuff of the whole attitude of the Exxon board," said Ric Marshall, executive director of ESG Research at MSCI. On the same day, a Dutch court ordered Royal Dutch Shell to commit to deeper emissions cuts.

3

Celebrity Cruises to sail again in June

Celebrity Cruises announced Wednesday that it had received approval from the Centers for Disease Control and Prevention to resume cruise-ship trips for paying customers in June. The Celebrity Edge will sail from Fort Lauderdale on June 26, the first sailing since cruise ships were barred from operating in the United States 15 months ago due to the coronavirus pandemic. Royal Caribbean International, like Celebrity a part of Royal Caribbean Group, announced earlier this week it had been cleared for test cruises, a requirement for ships before carrying paying customers unless 95 percent of passengers and 98 percent of crew will be vaccinated. The Celebrity ship will meet that bar, requiring all passengers 16 and over to be vaccinated.

4

Stock futures drop slightly ahead of employment data

U.S. stock index futures edged down early Thursday ahead of fresh employment data. Futures tied to the S&P 500 and the tech-heavy Nasdaq were down by 0.2 percent and 0.3 percent, respectively, several hours before the opening bell. Futures for the Dow Jones Industrial Average were flat. Fresh labor-market data to be released Thursday morning could provide new clues on the state of the recovery from the damage of the coronavirus pandemic, and steer the market. The Dow closed little changed on Wednesday. The S&P 500 rose by 0.2 percent with a boost from companies tied to the economic reopening, including airlines and cruise ship operators. The Nasdaq gained 0.6 percent. Trading is expected to be light ahead of the three-day Memorial Day weekend.

5

FDA approves emergency use of COVID-19 antibody drug

The Food and Drug Administration announced Wednesday that it had granted an emergency use authorization for GlaxoSmithKline's COVID-19 antibody drug, Sotrovimab. The drug can be used to treat people as young as 12 with mild to moderate cases of COVID-19 that threaten to get more severe. It is not for patients who have already been hospitalized or need supplemental oxygen, the FDA said. GSK developed the drug with Vir Biotechnology. The companies said a trial of 868 patients showed that the drug reduced the risk of hospitalization or death in high-risk adults by 85 percent. GSK and Vir said the treatment would be available "in the coming months" for appropriate U.S. patients. They plan to apply for full authorization later in 2021.

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