FirstFT: SoftBank puts brakes on Arm’s London IPO

SoftBank has put on hold plans for a London initial public offering of Arm because of the political turmoil in the UK government, throwing doubt on Britain’s place as the future home of the Cambridge-based tech giant.

Prime Minister Boris Johnson has personally lobbied SoftBank’s billionaire founder Masayoshi Son to secure at least a partial listing for the chip designer on the London Stock Exchange.

But as Johnson’s government collapsed this month, the resignations included investment minister Lord Gerry Grimstone and digital minister Chris Philp, who had played leading roles in talks with the Japanese tech investor.

The departures led SoftBank to pause discussions about a UK listing of Arm, according to people briefed on the talks. An Arm IPO would be one of the biggest-ever tech flotations for London.

The political upheaval could pave the way for SoftBank to pursue a more straightforward US listing, which Son had originally favoured.

Do you have any feedback on the newsletter? Share your thoughts with me at firstft@ft.com, or hit reply to this email. Thanks for reading FirstFT Europe/Africa. Here’s the rest of today’s news — Jennifer

Five more stories in the news

1. Ukraine faces big cuts to wheat harvest The country’s farmers will plant up to two-thirds less wheat this year if Russia’s Black Sea blockade is not lifted, prolonging the global food crisis and pushing prices higher, agriculture minister Mykola Solskyi told the Financial Times.

2. Liz Truss gains ground on Penny Mordaunt The UK foreign secretary yesterday narrowed the gap with the trade minister to challenge former chancellor Rishi Sunak, the frontrunner to become the next Conservative party leader. Tom Tugendhat was knocked out of the contest, while outgoing PM Boris Johnson survived a Labour-led vote of no confidence.

3. EU considers rescheduling Covid vaccine deliveries to 2024 Member states are close to agreeing with BioNTech/Pfizer to delay jab deliveries into 2024 amid a glut of shots, according to people familiar with the matter, even as health authorities broaden eligibility for boosters to tackle rising infections.

4. Goldman Sachs warns of job cuts The Wall Street giant said it would slow hiring and may cull underperforming staff even as its traders helped it overcome a slump in dealmaking in the second quarter. Bank of America reported a 32 per cent drop in net income — a fall that was cushioned, for now, by consumer spending.

5. Europe hit by record heatwave Temperatures peaked at 37C across much of London and the south-west of England yesterday, causing disruption to travel, schools, hospitals and the electricity grid. At least five European nations have declared states of emergency or issued red alerts as tens of thousands of people have been displaced by wildfires.

The day ahead

Tory MP ballot A fourth round of voting takes place in the race to become the next head of the UK’s ruling Conservative party, followed by a final ballot tomorrow. The candidate securing the fewest ballots will be eliminated. Keep up to date with our leadership election tracker.

• Elsewhere in Whitehall: In his first speech as chancellor, Nadhim Zahawi will commit to bringing down inflation and rule out borrowing for tax cuts.

Putin in Iran for trilateral Syria talks Vladimir Putin will meet Turkey’s president Recep Tayyip Erdoğan and Iran’s Ebrahim Raisi in Tehran to discuss Syria. A Black Sea access deal to allow Ukrainian grain exports could also be sealed between Putin and Erdoğan. (Euro News, FT)

Corporate earnings It’s a big day for earnings: Halliburton, Hasbro, Johnson & Johnson, Lockheed Martin, Netflix, Novartis, Swedbank, Telenor and Volvo Cars report results.

US chip subsidies Chuck Schumer, the Democratic Senate majority leader, may call a vote as soon as today on a long-awaited $52bn package of support for US chipmakers to confront China’s growing technological prowess.

Economic data The EU publishes final inflation figures for June while the European Central Bank releases its second-quarter eurozone bank lending survey. Britain has labour market statistics for the same month.

What else we’re reading

Lagarde wrestles with an ‘impossible situation’ The last time the ECB raised interest rates in 2011, it was forced into a reversal within months as the eurozone plunged into a wrenching debt crisis. Fears of a similar outcome are front of mind as Christine Lagarde prepares to announce the ECB’s first rate rise in 11 years on Thursday to curb inflation.

Israeli attacks feed fear and distrust in Iran Israel has been blamed by Iran for the assassination of at least five nuclear scientists in the last 12 years; the most recent, in 2020, was a sophisticated operation involving a remote-controlled machine gun. The killings have stoked concerns that a shadow war could burst into the open.

Young people are suffering a social recession Did Covid-19 improve our social capital by reminding us of our dependence on each other, driving acts of kindness and care? Or did it make it worse, leaving more people isolated and lonely? The answer depends on who and where you were, Sarah O’Connor writes.

Italy’s hard-right parties ready to fill void Mario Draghi’s offer last week to resign as prime minister triggered enthusiasm on the far-right for a snap election. A new rightwing coalition would have significant implications for Rome’s stretched public finances and its approach to the war in Ukraine.

‘Could we just adapt to climate change? The answer is no’ For Corinne Le Quéré, one of the world’s experts on global emissions, there is no great revelation in the UK’s record-breaking temperatures. “It is so predictable how climate change is unfolding,” she said in an interview with Henry Mance. “It’s like a train moving forward.”

Fashion

In the Tory leadership race, there are no style winners. From Liz Truss’s Thatcher throwbacks to Rishi Sunak’s too-slick suits, here’s how the frontrunners’ wardrobes are — or are not — helping their campaigns.