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Square to buy majority stake in Jay-Z’s Tidal streaming platform

Mobile payments company Square has agreed to acquire a majority stake in Tidal, the streaming platform owned by Jay-Z, for $297m.

Square will pay for Tidal in a mix of cash and stock and said it would name Jay-Z to its board of directors. The deal will allow the financial services company to expand its portfolio into music streaming as competition among platforms such as Spotify and Apple has grown.

Tidal describes itself as a music service “built by artists, for artists.” A group of musicians led by Jay-Z bought the company in 2015 for $56m.

“It comes down to one simple idea: finding new ways for artists to support their work,” said Jack Dorsey, co-founder and chief executive of Square. “New ideas are found at intersections, and we believe there’s a compelling one between music and the economy.”

Square’s share price has risen by nearly 500 per cent since the lows of last March, making it one of the biggest corporate winners of the pandemic. Its meteoric share rise was driven by businesses being forced to set up ecommerce operations during worldwide lockdowns, and more customers paying digitally rather than in cash over the past year.

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Tesla to become adviser on nickel project in bid to secure key metal

Tesla has agreed to buy nickel from a mine in New Caledonia in a move to secure its supply of the battery metal, which its chief executive Elon Musk has called the group’s “biggest concern.”

The electric-car maker will become a technical adviser at the Goro mine on the Pacific island and also get long-term supplies of nickel from the project as part of an agreement with the New Caledonian government, according to a person directly familiar with the matter.

The move comes amid growing concerns about future supplies of nickel, following a 26 per cent rally in prices of the metal over the past year and growing investment by Chinese companies in Indonesia. Nickel is needed for the most powerful lithium-ion batteries used in electric vehicles.

“Nickel is our biggest concern for scaling lithium-ion cell production,” Musk said on Twitter last month.

New Caledonia is one of the largest nickel producers, but protests in the French territory have delayed the sale of the lossmaking Goro mine and refinery by Vale to a consortium called Prony Resources.

The agreement reached in New Caledonia on Thursday will allow the sale to go through and give 51 per cent of the project to state entities based in the territory, according to a Reuters report citing the text of the agreement released by New Caledonia’s political parties. Commodity trader Trafigura will have a 19 per cent share, according to the Switzerland-based company.

While Tesla will not have an equity stake, its close involvement in the mine signals its efforts to have greater control over its entire supply chain, from mine to battery, as it ramps up production. A Tesla spokesperson in the UK declined to comment on the news. Vale could not immediately be reached for comment.

Last year Tesla agreed to buy cobalt, another battery metal, from the Swiss miner Glencore.

Nickel, which is mined mostly in Russia, Canada, New Caledonia and Indonesia, is primarily used to make stainless steel. But growth in electric vehicles is adding a new source of demand for the metal.

While Chinese companies have invested heavily in new nickel projects in Indonesia over the past few years, the process to extract and process the nickel uses energy from coal-fired power.

“The only incremental nickel tonnage is coming from Indonesia but the problem with Indonesia from an ESG perspective is it may not meet the criteria of Tesla,” Jim Lennon, an analyst at Macquarie, said. “Tesla is way behind in securing units and the Chinese have wrapped it up.”

On Tuesday, Chinese stainless steel producer Tsingshan said that it had signed an agreement to sell 100,000 tonnes of nickel to two Chinese battery materials companies, Huayou Cobalt and CNGR Advanced Material.

The Chinese company said it had begun producing higher purity nickel at its plant in Indonesia since last July, a form suitable for electric vehicle batteries, according to a statement on its official WeChat account.

Following the news, nickel prices fell by 8 per cent on Thursday, as traders bet that Indonesian nickel would alleviate any shortage in the market.

Nickel last traded at $16,225 a tonne, down 13 per cent this week.

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Flash rally in Bank of Japan shares leaves brokers perplexed

Shares in the Bank of Japan surged on Thursday for a fourth consecutive session, putting them more than 90 per cent up for the week and leaving brokers struggling to explain the rally.

The bull run is all the more remarkable given that the stock is notoriously illiquid, offers no dividend, is worth less than a tenth of its peak value and is synonymous with a two decades-long failure to combat falling prices.

In its new role as Japan’s least likely “meme stock”, the BoJ has risen by a total of 93 per cent from the close at the end of last week. Despite numerous theories, nobody, say veteran traders, can be quite sure who is doing the buying.

Some brokers have suggested that the BoJ’s shares have become an unexpected bellwether of what Oki Matsumoto, chief executive of the brokerage Monex, described as a “negative bubble” in cash — referring to the flood of asset purchases by central banks around the world since the Covid-19 crisis began that has fed investor appetite for any asset deemed in tight supply. 

But that is just one of a range of theories. Another centres on the idea that some investors are giving the BoJ stock a higher valuation because recent gains in Japanese stocks have generated huge unrealised profits on the bank’s policy-swollen portfolio of exchange traded funds.

Some have even suggested that BoJ shares purchased in 2021 might represent a macabre keepsake by which to remember the era of negative interest rates, yield curve control and other unorthodox policies introduced by the central bank. 

The central bank has been listed on the Jasdaq market for small companies since 2004 but first became a publicly traded company in 1949. The stock is 55 per cent held by the government, cannot be traded on an electronic exchange and provides retail shareholders with no voting rights. 

The most recent 15 per cent gain on Thursday — on a trading volume of just 11,600 shares — propelled BoJ shares to their highest level since 2015.

It is just the latest wild swing in a stock that has a history of eye-catching volatility and long-term value destruction. Owners of the stock since its most recent surge in mid-2007 have lost almost 70 per cent. Those that bought the BoJ on the over-the-counter market at its peak in 1988 have seen their paper loss spiral to more than 90 per cent.

In a note to clients this week, the veteran Japan equities analyst Pelham Smithers said that the experience of BoJ shares in the 1980s had provided a useful warning of the meme stock concept. For those that got in and out early, there was a chance of some profit. But liquidity — as with many modern-day hot stocks such as US retailer GameStop — is the challenge.

“If you didn’t get out in time, then you had a problem: there was absolutely no reason for anyone else to buy the shares. There’s no dividend and no chance of a takeover, so no income stream and no exit. Owning shares in Bank of Japan was like owning a zero-coupon perpetual bond,” wrote Smithers. 

Making a small amount of money on BoJ shares might be possible, said Smithers, “but to make a lot of money in them is both difficult and, based on past evidence, fraught with risk of a large and lengthy loss”.

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FC Barcelona and Real Madrid will be forced to pay back illegal state aid

FC Barcelona and Real Madrid will be forced to pay back millions of euros in illegal state aid after the EU’s highest court ruled Brussels was right to declare that beneficial tax arrangements they enjoyed for a quarter of a century were illegal.

The decision by the European Court of Justice upholds previous rulings by the European Commission and comes as Barcelona, the world’s highest-earning football club, is enduring one of the biggest crises in its history. 

This week police arrested the club’s former president, its current chief executive and its general counsel, in connection with a separate legal case ahead of a vote on Sunday to decide its next president. Barcelona, which recorded a loss of €100m last year, also has to contend with a debt pile of more than €1bn.

In 2016 Margrethe Vestager, the EU’s competition chief supremo, ordered four Spanish football clubs to pay back tens of millions of euros received since the 1990s in the form of sweetheart property deals, tax breaks and soft loans.

FC Barcelona subsequently contested the decision before the General Court, the EU’s second-highest tribunal, which annulled the commission’s judgment. However, after a final appeal from Brussels the ECJ ruled in favour of the EU.

In its decision on Thursday — which is final — the ECJ deemed the tax scheme “liable to favour clubs operating as non-profit entities over clubs operating in the form of public limited sports companies”, holding that it could therefore qualify as illegal state aid under EU rules.

The General Court had previously annulled Brussels’ decision over what it said was lack of sufficient evidence that the tax arrangements offered to the four football clubs, which also include CA Osasuna and Athletic Bilbao, were illegal.

But the commission had questioned the court’s “heavy burden of proof” on regulators in its appeal, arguing that a lower tax rate was obviously more favourable than a higher one.

The ECJ argued that the difficulty in assessing the extent of state aid — because of the complexity of tax deductions — did not preclude the commission from banning government practices that it considered gave sports clubs unfair advantages. 

It said: “The impossibility of determining, at the time of the adoption of an aid scheme, the exact amount, per tax year, of the advantage actually conferred on each of its beneficiaries, cannot prevent the commission from finding that scheme was capable, from that moment, of conferring an advantage on those beneficiaries.”

The Spanish government said on Thursday it had “absolute respect” for the court’s decision. FC Barcelona and Real Madrid did not immediately respond to requests for comment.

The judgment will be seen as a big win for regulators in Brussels who have for years been trying to stop highly successful commercial clubs from freeriding on the back of taxpayers.

The European Commission said on Thursday it noted “the judgment by the Court of Justice to follow the Commission’s arguments”.

Thursday’s ruling is the second time Brussels has won an appeal of its state aid decisions in recent weeks. Last month judges at the General Court rejected a legal challenge by budget airline Ryanair to state aid given to rivals on discriminatory grounds.

At present Barcelona is dealing with the fallout of what the Spanish media dubs Barçagate — allegations, denied by the club, that it corruptly hired outside groups to defame former president Josep Maria Bartomeu’s adversaries on Facebook.

Bartomeu was temporarily detained by the Catalan police earlier this week. He, the club, and other individuals in the case, which is being investigated by a Barcelona court, have all denied any wrongdoing.

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Government bond sell-off pauses ahead of Powell remarks

A global sell-off in government bonds paused on Thursday as investors awaited remarks by Federal Reserve chairman Jay Powell that could signal how the central bank will react to ructions in the sovereign debt markets.

Following a fresh bout of selling in US Treasuries on Wednesday, which spread to debt issued by other nations from Canada to Italy, the yield on the 10-year US government bond was broadly flat in early trading on Thursday at 1.47 per cent.

Germany’s 10-year bond yield fell 0.02 percentage points, as people bought the debt, to minus 0.3 per cent, while Italy’s slipped 0.01 percentage points to 0.74 per cent.

The yield on the 10-year Treasury, which acts as a benchmark for borrowing costs and asset prices worldwide, has risen rapidly from about 0.9 per cent at the start of the year.

Investors have offloaded the debt as President Joe Biden pushes his $1.9tn coronavirus relief package through the US legislature, raising expectations that the heavy stimulus spending will create strong economic growth and feed inflation.

The Fed continues to buy at least $120bn of financial assets each month to add liquidity to financial markets, as part of its emergency response to the pandemic that has helped drive global stock markets to a series of record highs.

Powell, who speaks at a Wall Street Journal summit at around 5pm UK time, is under growing pressure to respond to the bond sell-off. But economists at Morgan Stanley said he was unlikely to discuss using measures that would “combat an undesired tightening of financial conditions”.

“Policymakers will probably continue to hold the view that the rise in longer-term rates is commensurate with an improving economic outlook,” they added.

Stock markets were weak on Thursday as equity investors remained cautious about higher bond yields, which determine the discount rate used to value companies’ future cash flows. Europe’s Stoxx 600 equity index dropped 0.9 per cent, the UK’s FTSE 100 fell 1 per cent and Germany’s Xetra Dax lost 0.6 per cent, following a sell-off in the US overnight.

Hong Kong’s Hang Seng index closed 2.2 per cent lower, while mainland China’s CSI 300 dropped 3.2 per cent.

Futures markets signalled the US S&P 500 equity index would open 0.5 per cent lower and the top 100 stocks on the technology-focused Nasdaq Composite would fall 0.7 per cent.

Catherine Doyle, investment specialist at Newton Investment Management, said equity investors would probably continue to avoid shares in technology and other growth companies whose high valuations have been underpinned by low interest rates — and were a focus of Wednesday’s sell-off.

Doyle said she expected companies whose fortunes were linked to an economic recovery, such as banks and oil producers, to continue to do well. “For an equity investor, the main themes are reflation and economies reopening,” she said.

The dollar, as measured against a basket of currencies, strengthened 0.3 per cent. Brent crude, the international oil benchmark, fell 0.6 per cent to just under $64 a barrel as the Opec+ group of oil producers began their latest meeting.

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What independence movements teach us about belonging

Anyone who has experienced Brexit in Britain or Trumpism in the US knows what a divided society feels like. Spending time in Barcelona last year, I recognised that atmosphere. Catalonia has been split down the middle by the region’s quest for independence from Spain. The resulting quarrels break up Sunday family lunches, or end life-long friendships.

No new state has emerged in western Europe since Malta became independent from the UK in 1964, but now there are three candidates. Scotland’s parliamentary elections on May 6 are effectively a referendum on independence, with the secessionist Scottish National Party expected to win a majority. That same month, Northern Ireland marks its centenary amid a Brexit-inspired push towards Irish unification.

None of these new states is likely to emerge anytime soon, if ever. London and Madrid can block Scottish and Catalan independence. Very few people in either part of Ireland are keen to hurry unification. Instead, these issues will probably stagnate into frozen conflicts, allowing polarisation to seep into everyday life.

Identity issues are the most emotive in politics. Few people stalk out of Christmas dinner because they disagree about the nuances of the Green New Deal. But introduce binary choices like “Should we live in Catalonia or Spain?” or “Scotland or Britain?” and some will get overexcited. In Northern Ireland, of course, unionists and nationalists generally wouldn’t be having Christmas dinner together in the first place.

The best way to keep a society united, argues the philosopher Amartya Sen, is to encourage everyone to hold multiple identities. People can feel simultaneously Catalan and Spanish, Scottish and British, even Irish and British, as long as they are left in peace to muddy their identities. Some are happiest living outside all ethnic clubs. The numbers in Northern Ireland who identified as neither unionist nor nationalist rose in the years before Brexit, notes Katy Hayward of Queen’s University Belfast.

But independence movements push people to choose a single identity. From 2006 through 2019, the segment of Catalonia’s population that considers itself “only Catalan” jumped 15 percentage points, reports José Oller of the University of Barcelona and colleagues.

Worse, these national identities pile on top of other polarising identities. In Catalonia, most indepes, as they are called, are well-off, native-born people who grew up speaking Catalan. In some of their workplaces and social settings, speaking Spanish is now frowned upon. Dissidents risk being informally boycotted in their professional lives.

Meanwhile, people in Catalonia of migrant origin — whether from Spain or abroad — mostly oppose independence. This social divide was pre-existing, but has recently become politically toxic.

In Scotland, supporters of independence are likely to be relatively young, well educated and anti-Brexit, says David McCrone of Edinburgh University. In Northern Ireland, Protestant unionists are more likely than nationalists to be older.

They are also worried about the survival of their identity. This year’s census may show Northern Irish Catholics outnumbering Protestants for the first time ever. And the trade border that Brexit has placed in the sea dividing Northern Ireland from the British mainland is probably here to stay, much as unionists loathe it.

The risk isn’t so much that some of them will try terrorism as that they will lose faith in democracy, says Hayward.

So far, Scotland is the least polarised of these regions. The independence referendum of 2014 — won by unionists — was relatively good-humoured. Even so, in focus groups afterwards, the pollster Lord Ashcroft recorded comments such as, “On my building site now no one talks about football, it’s all politics,” and, “It was testing for us, because we were a divided household. We stayed in different houses on the day of the referendum because he was very strongly Yes.”

Many Scots in recent years have found firm political identities online, with “rants emanating from all sides”, recounts Elizabeth Anne Bailey in her book Political Participation on Social Media. When a YouGov poll last year found that only 16 per cent of Scots believed Scotland was united, Gordon Brown, the former British prime minister and a vocal unionist, said Scotland looked like “two nations”. He warned, “These divisions could dominate our lives for many decades to come.” “Divisive referendum” may be a unionist mantra, but it’s an accurate one.

I completely understand why most Scots (according to polls) now back independence. They have been governed from Westminster by a party they didn’t elect for nearly 80 per cent of the period since 1945, points out McCrone. Brexit was done to them. Meanwhile, a small plurality of people in England either has no opinion on Scottish independence or actively supports it, reported YouGov last September.

But dividing people into identity groups and then letting the biggest group decide rarely works brilliantly. Better to let sleeping identities lie, and to argue instead about boring issues like carbon offsets and street lights.

Simon and author Leïla Slimani will discuss “The future of the Fifth Republic: writing and thinking about modern France” at the FT Weekend Digital Festival, March 18-20. For more information and tickets visit

Follow Simon on Twitter @KuperSimon and email him at [email protected]

Follow @FTMag on Twitter to find out about our latest stories first. Listen to our podcast, Culture Call, where FT editors and special guests discuss life and art in the time of coronavirus. Subscribe on Apple, Spotify, or wherever you listen

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Hong Kong dropped from economic freedom index after crackdown

Hong Kong has been dropped from a prominent index of the world’s freest economies, underlining growing concerns over Beijing’s tightening grip on the Asian financial centre after it introduced a national security law last year.

The announcement from the Heritage Foundation, a conservative US think-tank, came as the territory was expected to end a marathon bail hearing for 47 pro-democracy politicians in a case that critics say shows the rapid decline of civic freedoms in the city.

The Heritage Foundation also dropped the Chinese special autonomous region of Macau, a casino hub and former Portuguese colony, from the rankings.

The foundation in recent years has been aligned with the administration of former US president Donald Trump.

“No doubt both Hong Kong and Macau . . . enjoy economic policies that in many respects offer their citizens more economic freedom than is available to the average citizen of China,” the Heritage Foundation said. “But developments in recent years have demonstrated unambiguously that those policies are ultimately controlled from Beijing.”

Beijing imposed the national security law on Hong Kong last year in response to anti-government protests that engulfed the city in 2019.

The measures are part of a clampdown on civil and political freedoms guaranteed to the city for 50 years following its handover from the UK to China in 1997. Authorities are targeting anyone viewed as disloyal to the Chinese government in politics, education and the media.

The Hong Kong government has long taken pride in studies showing its economy to be one of the most liberal in the world, with the city marketing itself as an international business haven given its low tax rates and open port.

The Heritage Foundation last year replaced Hong Kong at the top of its “Index of Economic Freedom” with Singapore, toppling it from a position it had held for 25 years, but still included the territory in the rankings in second place.

The case against the 47 pro-democracy lawmakers and activists has been seen as a test of whether the city’s legal system can withstand pressure from Beijing.

Authorities charged the group with subversion, alleging they aimed to topple the government by staging an unofficial primary vote to select candidates to run for election to the city’s legislature. Subversion is punishable with up to life imprisonment under the national security law.

The bail hearings, presided over by a judge appointed to oversee national security cases, entered their fourth day on Thursday.

Sessions have often stretched late into the evening, including one that continued until 3am before the defendants were hauled back before the court the next day. At least one defendant collapsed inside the courtroom and six others were sent to hospital for treatment.

“I don’t believe our courts in recent times have had to deal with so many contested bail cases at once,” said Simon Young, a law professor at the University of Hong Kong. “What has happened is most unsatisfactory in terms of both the treatment of the defendants and the efficiency of the process.”

Some of the defendants have faced multiple trials simultaneously and were forced to shuffle between courtrooms.

The defendants’ lawyers said on Tuesday their clients had not bathed in three days, forcing the judge to delay the hearing to allow them to wash.

Hundreds of supporters have queued each day in an attempt to watch the proceedings in person. Many held placards and chanted banned political slogans, risking prosecution under the security law.

A 50-year-old bank executive, who queued on Tuesday and had taken leave to view the proceedings, told the Financial Times he believed the group was being prosecuted for no reason.

“[The prosecution] is ridiculous,” he said. “We want to see how the Hong Kong legal system holds up under the national security law.”

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SoftBank-backed Z Holdings seeks mega-deal to shake up online world

Japan’s Z Holdings, the newly formed SoftBank-backed internet group, is seeking a transformative deal to reshape the social media landscape the way Google and Facebook did in buying YouTube and Instagram.

In an interview with the Financial Times, the joint chief executives of Z Holdings said the group would pursue acquisitions as well as tie-ups with start-ups backed by SoftBank’s $100bn Vision Fund to create a south-east Asian rival to tech giants in the US and China. 

“We will be looking for opportunities to acquire an epoch-making global service,” said Kentaro Kawabe, co-chief executive of Z Holdings.

This week, Z Holdings, a subsidiary of SoftBank’s telecoms arm that operates Yahoo Japan, completed its merger with messaging app Line, which was majority owned by South Korean internet search group Naver. The combined entity has a market capitalisation of $43bn.

Backed by SoftBank founder Masayoshi Son, the merger is the most serious attempt by Japanese and South Korean internet companies to create a powerhouse in data and artificial intelligence serving Asian markets outside China.

“Our ambition is to become the third [technology] option for the world,” Kawabe said. 

The deal also came as regulators worldwide seek to rein in the growing powers of Big Tech, while businesses find themselves caught in the technology war between the US and China.

As part of the integration, the two groups plan to invest ¥500bn ($4.7bn) to expand Z Holdings’ AI capabilities and hire 5,000 engineers globally. Kawabe said acquisitions of start-ups would be done using a separate, unspecified budget.

Z Holdings aims to generate ¥2tn in revenue by the fiscal year ending in March 2024 by expanding advertising sales as well as its ecommerce and payment businesses. 

The group plans to capitalise on Line’s existing success in south-east Asian markets such as Taiwan, Thailand and Indonesia to expand its global footprint especially since Yahoo Japan has no presence outside Japan. 

While Line has built a strong user base for its messaging service, its efforts in payments and ecommerce have just started in countries such as Thailand and Indonesia. 

Takeshi Idezawa, the group’s other co-CEO who used to head Line, said it would look to expand its south-east Asian food delivery, ride-sharing, ecommerce and fintech businesses through potential tie-ups with Vision Fund-backed companies.

The fund’s investment portfolio includes Indonesian ecommerce group Tokopedia, Grab, the south-east Asian ride-hailing and food delivery app and South Korean ecommerce group Coupang.

In its home market, the group — which will have 300m domestic users — also aims to help accelerate Japan’s efforts to digitalise government and healthcare services after the Covid-19 pandemic exposed their heavy reliance on paper processes.

“We feel ashamed. We had previously given up on government agencies since they still use fax machines,” Kawabe said. “But from now on, we’re going to be actively making proposals for digitalisation.”

The co-chief executives of Z Holdings said they were prepared for increased regulatory scrutiny as Japan joined other governments in tightening supervision of digital platforms with the passage of a law this year aimed at protecting smaller retailers.

“We want to take steps before tensions emerge,” Idezawa said. “With two companies becoming one, we will become a significant force and there will be responsibility that comes with that.”

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Deliveroo picks London for IPO after listings review

Deliveroo has chosen London for its highly anticipated initial public offering after Rishi Sunak, the UK chancellor, endorsed an overhaul of listing rules to allow founders to retain more control after going public. 

The multibillion-pound IPO is expected to be among London’s largest this year, handing the City a much-needed win over New York and Amsterdam at a time of feverish activity in new tech listings. 

“Deliveroo is proud to be a British company, and the selection of London as its home for any future listing reflects Deliveroo’s continued commitment to the UK,” said Claudia Arney, Deliveroo’s chair. 

Deliveroo’s decision follows the publication on Wednesday of a review by Lord Jonathan Hill, former EU financial services commissioner, which recommended a wide range of reforms to loosen listing rules in the UK. 

Among Hill’s recommendations were proposals to allow dual-class share structures, which allow founders to hold on to extra voting rights after an IPO, to be used by companies trading on the London Stock Exchange’s “premium” segment. The dual-class arrangement is popular in Silicon Valley, where it is used by companies including Facebook and Google parent Alphabet. 

The move, which Sunak endorsed during Wednesday’s Budget, was designed to attract fast-growing tech companies such as Deliveroo, though some London fund managers fear the change puts shareholder protection at risk.

Deliveroo said in a statement on Thursday morning that its dual-class structure would be “closely in line” with the Hill review’s recommendations and be limited to three years. However, the changes are unlikely to come into force before it has completed its IPO, with initial paperwork expected to be filed as soon as next week.

Companies with dual-class structures can already trade on the LSE’s standard listing. Once the new rules are in place, Deliveroo would be able to move up to a premium listing. A person close to the company said that the Hill review was also likely to attract more tech companies to London, making it more attractive as a listing venue overall.

“Alongside the dual-class share structure, Deliveroo intends to have a strong commitment to corporate governance standards including a majority independent board of directors as well as upholding diversity standards,” the company said. 

Will Shu, Deliveroo’s co-founder and chief executive, said he was “proud and excited” to list in London, where the company first began making restaurant deliveries in 2013. 

Sunak hailed the decision as “fantastic”. 

“Deliveroo has created thousands of jobs and is a true British tech success story,” he said in a statement. “It is great news that the next stage of their growth will be on the public markets in the UK.”

Arney added: “London is not just where Deliveroo was born, it is one of the leading capital markets in the world, with an incredible technology ecosystem, sophisticated investment community and a skilled talent pool. The time-limited dual-class structure would provide Will and his team with the certainty needed to execute against their ambitious growth plan to become the definitive online food company.”

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House Democrats pass landmark US voting rights bill

The US House of Representatives passed sweeping legislation to protect voting rights in America, as the Democratic majority in the lower chamber of Congress moved to counter Republican efforts to restrict ballot access.

The vote marked the latest salvo in the political battle over election laws in the wake of the 2020 election, when Donald Trump, the former president, refused to concede to Joe Biden and repeatedly made unsubstantiated claims of voter fraud.

The reforms included provisions for automatic voter registration, a requirement that states guarantee a window for early voting and allow mail-in ballots and the restoration of voting rights for felons who have completed their sentences.

“Everything is at stake, we must win this race,” Nancy Pelosi, the House Speaker, said ahead of the vote on Wednesday. “At the same time as we gather here to honour our democracy, across the country over 200 bills are being put together to suppress the vote.”

The bill passed by a margin of 220-210, with near-unanimous support among Democrats but no Republican backing.

It is unlikely to be approved by the Senate because it would need a bipartisan supermajority to advance in the upper chamber.

However, many House Democrats are expected to pressure their party’s senators over the coming weeks to change the rules to allow a simple majority vote, which would give the proposed measures a far better chance of being enacted.

Federal legislation on voting rights is seen by Democrats as a crucial safeguard heading into the 2022 midterm elections, when they are hoping to avoid defeats that would hand control of Congress back to the Republicans just two years into Biden’s presidency.

Republicans are resisting the Democratic efforts to protect voting rights, accusing them of a “takeover” of US elections that are mostly managed at the state level.

“Democrats did not design [the bill] to protect your vote. They designed it to put a thumb on the scale of every election in America and keep the Swamp swampy,” Kevin McCarthy, the Republican leader in the House, wrote on Twitter.

The legislation is designed to neutralise efforts championed by Republicans in states such as Georgia to tighten ballot access by forcing individuals to bring identification to the polls and ban early voting on Sundays.

A legal challenge to state-level voting restrictions in Arizona is being considered by the US Supreme Court, but many legal analysts and activists do not expect the conservative majority to overturn the measures.

The House bill also contained measures to allow public funding of political campaigns, increase the transparency of political donations and require the disclosure by presidential candidates of 10 years of tax returns.

The bill would also limit the ability of states to redraw congressional districts along partisan lines.