One thing to start: Former Bank of England governor and Goldman and Brookfield executive Mark Carney has won Canada’s election, the national broadcaster projected.

And another thing: JAB Holding chair Peter Harf is retiring after more than 40 years at the business, as the investment group he created diversifies away from its troubled consumer-focused portfolio. His exit comes as JAB’s portfolio was slashed by $10.1bn in 2024, after its investments in coffee, bakeries and beauty were marked down dramatically.

In today’s newsletter: 

• Macquarie defends Thames Water stint

• The lawyer caught in Trump’s crosshairs

• Hopes for Toyota deal spur Japan stock rally

Macquarie ‘very proud’ of Thames Water ownership

Over the course of Macquarie’s ownership of Thames Water, the water utility leaked £2.7bn in dividends and its debt grew from £3.4bn to £10.8bn.

Thames now teeters on the brink of insolvency — and an expensive and very public renationalisation.

But Macquarie, the Australian group that led Thames from 2006 to 2017, doesn’t think its record is all that bad.

Its tenure, it seems, is even a point of pride for the infrastructure giant’s leadership.

“We’re actually proud, very proud of our ownership of Thames Water,” said Ben Way, group head of Macquarie Asset Management, at an investor meeting last month.

Way added that Macquarie’s investment was “a very good example of the ability to have the courage of your convictions and look beyond the media drama or noise”.

The comments come after Thames Water’s troubles drew the ire of UK politicians and many of its large shareholders — including Abu Dhabi’s sovereign wealth fund — who wrote off the value of their investments in the utility last year.

For Thames Water, neither the drama nor the noise has stopped.

The utility is seeking to agree to a buyout deal by June to avoid renationalisation. But the process is far from straightforward.

US private equity giant KKR is Thames’ preferred bidder, and the firm’s dealmakers recently took in the sights and smells of the utility’s sewage treatment facilities as part of the due diligence process for the purchase.

But even this could stoke controversy among the British public: Thames Water is covering part of the bill for the 100-or-so people KKR has evaluating the deal.

Creditors including Elliott Management and Silver Point are another faction that needs to be convinced, having already provided Thames Water with an expensive £3bn lifeline. The bondholders could be set to take as high as a 50 per cent stake as part of KKR’s deal.

KKR also faces tough negotiations with regulator Ofwat to lessen legacy fines, according to people close to the firm. It may hope for a relationship with Ofwat more akin to Macquarie’s.

Over the past decade “no regulator in the UK” has looked at the Australian financial group as anything other than “a very positive owner of assets”, said Macquarie’s Way.

The Trump Organization lawyer who crossed the president

The US litigation powerhouse Quinn Emanuel has built a reputation for being unafraid to take on high-profile or controversial clients. 

The law firm has represented everyone from Donald Trump sidekick Elon Musk to Kilmar Armando Abrego Garcia — whom the US wrongly deported to El Salvador last month. 

Quinn Emanuel’s ability to take on clients without worrying too much about who it might upset is central to its operations.

Yet one of its recent choices now appears to have upset the US president. 

Bill Burck, global co-managing partner of the firm, is acting for Harvard University as it sues the US administration over its attempts to freeze billions of dollars in federal funding. He was also, until last week, the Trump Organization’s ethics adviser. 

“He’s not that good, anyway,” the president posted on Truth Social last week, as he called for his family company to fire Burck over his work for the university.

(For some context: months earlier, the Trump Organization had said Burck was considered “one of the nation’s finest and most respected lawyers”.)

Within hours, Eric Trump indicated Burck would be removed from the role. 

DD’s Kaye Wiggins, James Fontanella-Khan and Amelia Pollard, and the FT’s Stefania Palma, break down the episode and why it matters. 

So far, Quinn Emanuel hasn’t been targeted in the way many other large law firms have. It’s not the subject of an executive order, nor is it on a list of 20 firms that received inquiries about their diversity practices. 

It’s also potentially less vulnerable than many Big Law firms to such attacks because it is litigation-orientated. It would be, at least theoretically, well-placed to fight back.

Burck had carved out a valuable role, as a lawyer who stood to benefit from ties to Trump’s inner circle. It’s not clear what will happen to such ties now. 

But the episode raises a big question: Can any lawyer represent the US administration’s adversaries without themselves becoming a target?

Toyota deal mania grips Japan

The Japanese stock market soared on Monday after the revelation that Akio Toyoda, grandson of carmaker Toyota’s founder and its current chair, had launched a $42bn buyout of its parts-making subsidiary.

The deal sent not just the stocks of Toyota Motor and the subsidiary Toyota Industries higher, but much of industrial Japan.

So why are investors so excited by this deal beyond the headline figure, which would put it among the biggest-ever buyouts?

The deal is fuelling hopes of broader corporate governance reform across the whole of Toyota, which is Japan’s most powerful company and maintains a complex network of cross-held shares with its many subsidiaries.

But hedge fund activists that have circled Toyota’s subsidiaries over the past year will welcome the move to unwind one of the biggest parent-subsidiary listings in Japan. Toyota Motor owns 40 per cent of Toyota Industries.

The carmaker’s scion, Toyoda, is leading the buyout proposal, which will include his family’s cash and financing from the country’s three biggest banks. Toyota Motor might also participate, people briefed on the matter told the FT.

But some analysts are already speculating that there may be a deeper motive driving Toyoda to pursue the deal.

Toyota Industries owns a 9.1 per cent stake in Toyota Motor, meaning the reorganisation could lead to Toyoda owning a significant stake in the carmaker.

That would allow him to cement family control over the group at a time when the car industry is going through a period of seismic disruption.

Job moves

• Goldman Sachs has appointed Sushil Bathija as head of mergers and acquisitions in Asia, excluding Japan. Bathija currently leads Goldman’s consumer retail group in the region and is chief operating officer of the Asia ex-Japan M&A team.

• German chancellor-in-waiting Friedrich Merz has picked Katherina Reiche, chief executive of Eon subsidiary Westenergie, as his economy minister. Reiche was previously an MP for Merz’s Christian Democratic Union party.

• JPMorgan Chase has named 10 new managing directors in its global advisory and M&A practice.

• SQ Capital has hired Henry Minello as a managing director on its investment team and Andrew Curry to its investor relations team.

Smart reads

Treasury traders Hedge funds are now among the most important buyers of US government debt. The FT explores how that dynamic amplified the recent Treasury market swings.

Power chats America’s elites turned to a nexus of private group chats as they sought shelter from pandemic-era cancel culture, Semafor reports. Those Signal and WhatsApp groups cemented the alliance between tech billionaires and the US political right.

The alternatives era Blackstone is now Madrid’s biggest landlord, The New York Times writes. Rents are higher, and tenants are incensed. 

News round-up

‘60 Minutes’ takes swing at owner Paramount (FT)

Germany’s Merck to buy US biotech SpringWorks for $3.9bn (FT)

Airbus finalises deal to take over parts of aerospace supplier Spirit (FT)

France’s Banijay explores takeover bid for ITV (FT)

Goldman Sachs-backed start-up to buy UK sound studio in bet on AI music-making (FT)

Revived Andersen tax and advisory firm files to pursue US stock listing (FT)