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Honda, Nissan Discuss $54B Merger

Japanese automakers Honda Motor Co. and Nissan Motor Co. have initiated discussions regarding a potential merger, in a move to enhance their competitiveness in the rapidly evolving electric vehicle market. This development comes as traditional car manufacturers face mounting pressure from industry leaders like Tesla and emerging Chinese companies such as BYD.

According to reports, Honda and Nissan are considering the establishment of a new holding company under which the merged entity would operate. The plan may also involve Mitsubishi Motors Corp., in which Nissan holds a significant stake. The primary objective of this merger is to pool resources and expertise to better compete in the global EV market.

You can read more on the matter here.

What’s going on?

• Meta Hit with €251 Million Fine Over 2018 Data Breach (theDeepDive)

• Donald Trump says Canada becoming 51st U.S. state 'a great idea' (CTV)

• Canadian dollar dips below 70 cents US for first time since March 2020 (CBC)

• Fall Economic Statement: Ballooning Deficit, Trade Threats, And Growth Stalls Spell Financial Crisis (theDeepDive)

• Canada tightens immigration point system to curb fraud tied to job selling (FP)

• Doug Ford says he wants to sit down with Donald Trump to talk trade (Globe)

• Europe Stakes Its Claim in Space with Rival to Starlink (theDeepDive)

• Canada’s Rental Supply Posts Biggest Jump in More Than 30 Years (Bloomberg)

• U.S. Weighs Ban on Chinese-Made Router in Millions of American Homes (WSJ)

• Not In A Precious Metals Mining Bull Market And That’s A Good Thing | Peter Marrone, Allied Gold (theDeepDive)

• U.S. auto sales next year expected to be best since 2019 (CNBC)

What’s the latest?

• Banks: Spain’s Banco Santander is nearing approval to expand into Canada’s retail banking market, challenging the Big Six banks that control over 90% of assets. Canadian banks, with profit margins 40% higher than U.S. counterparts and $54 billion in 2024 earnings, are attractive but hard to disrupt. Santander’s digital Openbank model and auto loan integration could provide an edge, but experts question whether it offers enough appeal for Canadians to switch.

• WildBrain: WildBrain Ltd. is selling a two-thirds stake in its TV broadcast business, including Family Channel and WildBrainTV, to IoM Media Ventures for over $40 million over four years. The deal aims to simplify WildBrain's operations and reduce debt. Pending CRTC approval, the transaction is expected to close within three to six months.

• Barrick Gold: Barrick Gold Corp. has initiated international arbitration to resolve a dispute with Mali's government over its Loulo-Gounkoto gold mine, which produced nearly 700,000 ounces of gold in 2023. The disagreement centers on sharing economic benefits, with tensions escalating to employee detentions and an arrest warrant for CEO Mark Bristow. Barrick remains open to dialogue but aims to resolve the issue through fair and transparent arbitration.

• Mortgage: Mortgage rates rose to 6.75% from 6.67%, causing total mortgage applications to drop 0.7%, the first decline in five weeks. Refinance applications fell 3% weekly but were 41% higher year-over-year, while purchase applications rose 1% weekly and 6% annually. Markets anticipate a Fed rate cut, possibly the last for a while.

• UK Inflation: U.K. inflation rose to 2.6% in November, up from 2.3% in October, driven partly by higher energy costs and structural pressures like wage increases. Core inflation stood at 3.5%, slightly below forecasts, while services inflation remained steady at 5%. The Bank of England is unlikely to cut rates in December, aligning with market expectations, as persistent inflation contrasts with weaker-than-expected economic growth, including a 0.1% GDP contraction in October.

Canada’s silent depression: a productivity problem

The stock market and stuff

• Microsoft acquires twice as many Nvidia AI chips as tech rivals (FT)

• Torex Gold To See Production Resume At Morelos Complex (theDeepDive)

• Novo Holdings closes $16.5 billion buyout of contract manufacturer Catalent (Reuters)

In the juniors

• Organigram Reports Revenue Growth in Fiscal 2024, But Net Losses Continue (theDeepDive)

• Jaguar Mining Sees Turmalina Mine Shutdown By Regulators (theDeepDive)

• Patriot Battery Metals Secures $69 Million Investment From Volkswagen, Enters Offtake Agreement (theDeepDive)

• Hot Chili Hits 0.5% Copper, 0.3 g/t Gold Over 308 Metres At La Verde (theDeepDive)

FULL DISCLOSURE: Sterling Metals is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of Sterling Metals. The author has been compensated to cover Sterling Metals on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.