A raid in Switzerland | USAEMALL.com

One thing to start: Elon Musk’s artificial intelligence company xAI is nearing a $9.3bn debt and equity deal, as investors looked past the billionaire’s spat with President Donald Trump that had complicated the capital raising efforts.

And a wave of golden visas: Nearly 70,000 people have signed up for the new golden Trump Card, a visa scheme led by commerce secretary Howard Lutnick that will grant foreigners legal residency in the US at a cost of $5mn.

In today’s newsletter:

Stuck in Swiss secrecy law crosshairs

The FT has a history of upsetting Switzerland — especially Credit Suisse.

Swiss media previously claimed the FT and Bloomberg played a role in the bank’s negotiations during its emergency rescue deal with UBS. We broke a series of stories on the early contours of talks in a frenzied weekend rescue reminiscent of the 2008 global financial crisis.

We return with another story that might unsettle the Swiss, but this time with an eye towards press freedom instead of multibillion-dollar bank collapses.

Earlier this month, Swiss authorities raided the offices of the sarcastic and popular financial blog Inside Paradeplatz on suspected violations of banking secrecy laws.

This is the first use of Swiss bank secrecy laws against a journalist. Authorities also searched the Zurich home of Lukas Hässig, whose blog is named after a square in the city’s financial district.

Think Alphaville, but throw in the occasional market-moving scoop and conspiracy theory. Plus, it’s almost entirely focused on Swiss goings-on.

The alleged violations have to do with criminal proceedings connected to the case against Pierin Vincenz, the former chief executive of Raiffeisen Switzerland, who was jailed for almost four years for fraud and allegations over use of a company card to pay for strip clubs and Tinder dates.

Hässig also has a history of angering authorities, and Credit Suisse in particular.

In 2022, he published that State Street was planning a takeover of Credit Suisse, based on a single anonymous source.

Credit Suisse sued the blog in 2022, over three articles that compared the bank to Fifa, world football’s governing body that at the time was facing a global corruption scandal.

That said, Switzerland has some of the world’s strictest secrecy laws. Authorities prohibit disclosure of confidential financials and criminalise publishing leaked data, regardless of how the information was obtained.

An addendum to the banking secrecy penal code was introduced in 2015 that allows third parties such as journalists to be prosecuted.

Third parties that have nothing to do with banks can be convicted of confidentiality breaches. “If journalists cannot write this in Switzerland and write about criminal acts, we have a problem in this country,” Hässig said.

He said he would fight any charges. We’ll brace for the Swiss reaction.

The next act for Warner Bros Discovery

David Zaslav is lining up his second act.

The (highly paid) architect of the 2022 merger between pay-TV titans Discovery and Time Warner decided last week that the combined company, Warner Bros Discovery, needed to break up.

Its shares have shed 60 per cent of their value since the combination was formed three years ago. Running the sexier streaming and Hollywood content studio will be his new job. And he needs to be properly motivated.

Late on Monday, WBD shared a new pay package for Zaslav that is supposed to look a lot different than his old ones.

His 2024 pay was valued at a staggering $52mn, a princely sum that almost 60 per cent of participating shareholders recently rejected in an advisory vote.

WBD went to great pains on Monday to point out the new pay package on the surface is worth just $30mn annually, citing “shareholder feedback” and a smaller kingdom with the cable TV networks in a separate silo.

But there’s one more small detail. In order to align Zaslav’s interests with WBD stockholders, he is set to get 24mn company shares, with a strike price of about $10.

When the merger closed to form WBD, its shares were roughly $25. In other words, if he can get the company back to where it started, Zaslav is in line for a $350mn pot of gold, DD’s Sujeet Indap and the FT’s Chris Grimes report.

One way to juice the stock price: reach into the pockets of creditors.

Earlier on Monday, WBD announced it had successfully completed a debt restructuring that will knock off a couple billion dollars of principal from $36bn of bonds and give the company further flexibility with its balance sheet.

(Sujeet and the FT’s Will Schmitt have the details on that deal here.)

Zaslav for pride, one would think, would be interested in turning around Warner. If not, the money is there too.

Mid-tier UK law firms splash out

Last year, magic circle law firms boosted junior lawyers’ pay by 20 per cent to £150,000. Now, mid-tier firms want to be able to properly compete, too.

The rung of law firms just below those in the magic circle are shelling out raises for young talent to rival their deep-pocketed competitors.

Eversheds Sutherland raised pay for its London-based newly qualified lawyers from £100,000 to £110,000, while Pinsent Masons bumped up their starting salaries from £97,000 to £105,000.

Meanwhile, Ashurst announced a 12 per cent boost to £140,000, which took effect in May.

Not everyone has joined in the push to jack up pay, with some of the elite firms signalling they won’t repeat such big increases this year. Slaughter and May decided to hold pay at £150,000 for their starting lawyers.

While Simmons & Simmons and other mid-tier firms such as RPC and Shoosmiths haven’t dished out pay rises for NQs, they have agreed to pay for those willing to work extra hours. These firms have announced plans to offer bigger bonuses for those billing clients more hours — in some cases up to 40 per cent of lawyers’ base salary.

For Simmons associates, that means bonuses of between 25 per cent and 40 per cent of salary for those who hit more than 1,800 billable hours in the past financial year.

Even as pay steadily climbs across the firms, there’s still clearly envy.

These rates pale compared to lawyers at London-based American rivals such as Quinn Emanuel, which pay their new lawyers £180,000.

Job moves

• White & Case has hired Drew Valentine as a partner for its capital markets team in New York. He previously worked at DLA Piper.

• Yum Brands has promoted Chris Turner as the restaurant group’s next chief executive, succeeding David Gibbs, who is retiring. Turner is currently the company’s chief financial officer, and previously worked at PepsiCo.

• Morgan Stanley has named Lynn Good to the bank’s board of directors. She was previously chair and chief executive of Duke Energy.

Smart reads

Nuclear option OpenAI and Microsoft’s six-year-old friendship is turning into a feud, The Wall Street Journal writes. The start-up is considering making antitrust complaints about Microsoft — the “nuclear option”, according to people familiar.

Wall Street South Bloomberg talks to Ken Griffin about novice investors, Citadel’s pandemic outpost at the Four Seasons in Palm Beach and the future of Harvard.

Rebrand reversal UK asset manager Aberdeen Group reversed course after facing mockery for renaming itself Abrdn, in an attempt to be “modern, agile, [and] digitally enabled” the FT writes. What can companies learn from the rebrand gone wrong?

News round-up

Rolls-Royce calls for government to back plans for new aircraft engine (FT)

Airbus says dispute with Dassault is threatening fighter jet project (FT)

Amazon boss says AI will mean fewer ‘corporate’ jobs (FT)

Musk’s xAI burns through $1bn a month as costs pile up (Bloomberg)

Goldman ditches ban on Spacs as blank-cheque firms stage comeback (Bloomberg)

Trump spares TikTok from ban with another deadline extension (WSJ)