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By Andrew Galbraith

SHANGHAI (Reuters) – Global stocks extended a sell-off, the yen strengthened, and U.S. Treasury prices rose on Thursday as investors sought shelter in safe-haven assets amid growing fears of a full-scale Russian invasion of Ukraine.

As one of the worst post-Cold War security crises in Europe for decades worsens, U.S. Secretary of State Antony Blinken said he believes Russia will invade Ukraine within hours after separatists on Wednesday asked for Moscow’s help to repel “aggression” and as explosions rocked the breakaway eastern city of Donetsk.

The crisis deepened this week after Russian President Vladimir Putin dispatched troops into parts of Ukraine, triggering sanctions from Western countries.

Asset markets have seen a sharp increase in volatility, with oil racing to near $100 per barrel and the Cboe Volatility Index, known as Wall Street’s fear gauge, up more than 55% over the past nine days.

Overnight, U.S. stocks took a beating, with the Dow Jones Industrial Average down 1.38% to barely above the level that would have confirmed a correction. The MSCI World Index, a leading gauge of equity markets globally, skidded to its lowest level since April 2021.

In Asia on Thursday, the selloff showed no signs of abating.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.0% in early trade, with Australian shares diving 2.67%. In Tokyo, the Nikkei was 1% lower. Chinese blue chips fell 0.5%

Investors have also been grappling with the prospect of imminent policy tightening by the U.S. Federal Reserve aimed at combating surging inflation.

“A supply shock to commodities and the need for a higher geopolitical risk premium though may mean inflation remains elevated for longer with the risk the hiking cycle may need to be steeper,” said Tapas Strickland, director of economics at National Australia Bank.

While expectations of an aggressive 50-basis-point hike at the Fed’s March meeting have eased, Fed funds futures continue to point to at least six rate hikes this year. [FEDWATCH]

On Thursday, the benchmark U.S. 10-year yield rose to 1.9581% compared with its U.S. close of 1.977% on Wednesday.

The global flight to safety boosted the yen, with the dollar dropping 0.05% to 114.91. The euro was down 0.2% on the day at $1.1281 and the dollar index, which tracks the greenback against a basket of currencies of other major trading partners, was up at 96.344.

The Russian rouble firmed slightly by 0.55% against the dollar after falling more than 3% on Wednesday.

“Markets are now more adequately pricing in the risk of something horrific happening. That combined with the uncertainty is a horrible environment to be in. No one wants risk exposure when that’s floating around,” said Rob Carnell, head of Asia Pacific research at ING.

U.S. crude ticked up 1.01% to $93.03 a barrel. Brent crude also rose about 1%, to $97.7 per barrel.

Spot gold traded about 0.1% higher at $1,911.86 per ounce. [GOL/]

(Additional reporting by Alun John in Hong Kong; Editing by Shri Navaratnam)

By Tommy Wilkes and John McCrank

LONDON/NEW YORK (Reuters) – The United States, the European Union and Britain announced new sanctions on Russia on Tuesday after Moscow’s recognition of two separatist regions in Ukraine as independent entities.

Chief among their targets: Russian banks and their ability to operate internationally.

Yet the impact of the new sanctions is likely to be minimal. Western governments – for now – are preferring to keep the much larger sanctions packages that they have planned in reserve should the crisis escalate.

It means Russian bankers or their Western counterparts with exposures to the country won’t be losing much sleep.

Indeed, U.S. banks are not expecting global sanctions to have a major impact on American bank businesses or spark contagion risk, given lenders have little exposure to the Russian economy, said three executives familiar with industry thinking. [nL8N2UX2PZ]

Here’s how the banks are being targeted and which measures might hit harder:

WHAT HAS BEEN ANNOUNCED SO FAR?

European foreign ministers agreed to sanction 27 individuals and entities, including banks financing Russian decision-makers and operations in the breakaway territories.

The package of sanctions also includes all members of the lower house of the Russian parliament who voted in favour of the recognition of the breakaway regions.

Britain imposed sanctions on Gennady Timchenko and two other billionaires with close links to Russian President Vladimir Putin, and on five banks – Rossiya, IS Bank, GenBank, Promsvyazbank and the Black Sea Bank.

The lenders are relatively small and only military bank Promsvyazbank is on the Russian central bank’s list of systemically important credit institutions.

Bank Rossiya is already under U.S. sanctions from 2014 for its close ties to Kremlin officials.

Washington imposed sanctions on Promsvyazbank and VEB bank.

It also ramped up prohibitions on Russian sovereign debt, which U.S. President Joe Biden said meant the Russian government would be cut off from Western financing. The U.S. Treasury said it was extending current prohibitions to cover participation in the secondary market for bonds issued after March 1 by Russia’s Central Bank and other entities.

Russian dollar bonds extended their losses after the announcement on U.S. sanctions, with longer-dated issues slipping to record lows trading in the mid-90s, data showed. The premium demanded by investors to hold Russian debt over safe-have U.S. Treasuries blew out to 329 basis points, the widest since the COVID market rout in spring 2020.

WHAT WILL THE IMPACT BE?

For now – minimal.

Russia’s large banks are deeply integrated into the global financial system, meaning sanctions on the biggest institutions could be felt far beyond its borders.

But the new sanctions focus on smaller lenders.

The measures targeting banks are not yet as extensive as those imposed after Russia’s annexation of Crimea in 2014, although many of those sanctions remain in place.

Then the West blacklisted specific individuals, sought to limit Russia’s state-owned financial institutions’ access to Western capital markets, targeted the bigger state lenders, and imposed widespread limits on the trade of technology.

Britain’s new measures refrained from imposing limits on the biggest state banks, cutting off capital for Russian companies, or ejecting other prominent so-called Russian oligarchs from Britain.

Shares in Russia’s biggest banks, Sberbank and VTB soared after the state-controlled groups escaped the sanctions.

Analysts say Russian institutions are better able to cope with limited sanctions than eight years earlier, and Russian state banks have cut their exposure to Western markets.

Russia has since 2014 diversified away from U.S. Treasuries and dollars – the euro and gold account for a bigger share of Russia’s reserves than do dollars, according to a January report from the Institute of International Finance.

Russia has some strong macroeconomic defences too, including abundant hard currency reserves of $635 billion, oil prices near $100 a barrel and a low debt-to-GDP ratio of 18% in 2021.

“The ones today were not that significant,” said Samuel Charap, a senior political scientist at the nonprofit, nonpartisan RAND Corporation, about the U.S. sanctions.

“The question is where we go from here,” he said. “I am increasingly pessimistic, and I think there is a high probability of significant further Russian military action and I think in that case, we are likely to see some of the really qualitatively more devastating measures than in the past.”

WHAT MIGHT COME NEXT?

The EU has said it is ready to impose “massive consequences” on Russia’s economy but has also cautioned that, given the EU’s close energy and trade ties to Russia, it wants to ratchet up sanctions in stages.

Officials consider Tuesday’s measures as a first round.

Beyond lenders that do business directly with the breakaway regions, it’s not clear yet when or whether the EU will hit the biggest banks.

Washington has prepared a raft of measures including barring U.S. financial institutions from processing transactions for major Russian banks by cutting “correspondent” banking relationships, sources told Reuters last week.

Disabling international payments would hit hard.

Those measures, however, may be kept in reserve.

Russia’s Sberbank and VTB would face American sanctions if Moscow proceeds with its invasion of Ukraine, a senior U.S. administration official told reporters.

If such banks did get targeted, U.S. banks could face retaliation, said Charap, who pointed to cyber attacks as a potential weapon that could be used.

WHAT WOULD HIT HARDEST?

What the region’s banks and Western creditors fear most is the possibility that Russia is banned from a widely used global payment system, SWIFT, which is used by more than 11,000 financial institutions in over 200 countries.

Such a move would hit Russian banks hard but the consequences are complex. Banning SWIFT would make it tough for European creditors to get their money back and Russia has been building up an alternative payment system.

Data from the Bank of International Settlements (BIS) shows that European lenders hold the lion’s share of the nearly $30 billion in foreign banks’ exposure to Russia.

WHICH FOREIGN BANKS ARE MOST EXPOSED?

Europe’s banks – particularly those in Austria, Italy and France – are the world’s most exposed to Russia, and have been on high alert should governments impose new sanctions.

Graphic: Bank exposures to Russia – https://fingfx.thomsonreuters.com/gfx/mkt/myvmnxmabpr/banks%20russia.PNG

Italian and French banks each had outstanding claims of some $25 billion on Russia in the third quarter of 2021, according to BIS figures. Austrian banks had $17.5 billion. That compares with $14.7 billion for the United States.

Among the most exposed lenders is Austria’s RBI, which has big operations in Russia and Ukraine. It has said “crisis plans” would come into effect if things deteriorate. Its shares closed down 7.5% on Tuesday.

Many foreign banks have, however, significantly reduced their exposure to Russia since 2014, making some bankers less concerned about the threat of sanctions.

(Additional reporting by Tom Sims in Frankfurt, Iain Withers and Karin Strohecker in London, Michelle Price in Washington and John McCrank and Megan Davies in New York; Editing by Kevin Liffey, Rosalba O’Brien and Tim Ahmann)

By Karin Strohecker

(Reuters) -The United States and its allies are coordinating new sanctions on Russia after Moscow recognised two regions in eastern Ukraine as independent, officials said.

Details have started to emerge on the steps taken or planned by the United States, European Union, Britain and other Western powers.

Below are details on the curbs proposed so far and what other sanctions could target Russia:

BANKS & FINANCIAL FIRMS

Britain announced sanctions on five banks – Bank Rossiya, Black Sea Bank, Genbank, IS Bank and Promsvyazbank – all are smaller lenders, with only Promsvyazbank on the central bank’s list of systematically important lenders.

U.S. President Joe Biden announced sanctions on VEB bank and Russia’s military bank, referring to Promsvyazbank, which does defence deals. The Treasury Department said: “All assets under U.S. jurisdiction will be immediately frozen and U.S. individuals and entities are prohibited from doing business.”

A senior U.S. administration official added that Sberbank, and VTB Bank would face sanctions if the Russian invasion proceeds.

Bank Rossiya is already under U.S. sanctions from 2014 for its close ties to Kremlin officials.

The European Union has agreed to blacklist banks involved in financing separatist activities in eastern Ukraine.

Russia’s large banks are deeply integrated into the global financial system, meaning sanctions could be felt far beyond its borders. Data from the Bank for International Settlements (BIS) shows that European lenders hold the lion’s share of the nearly $30 billion in foreign banks’ exposure to Russia.

According to data from Russia’s central bank, total Russian banking foreign assets and liabilities stood at $200.6 billion and $134.5 billion respectively with the U.S. dollar share amounting to around 53% of both, down from 76%-81% two decades ago.

SOVEREIGN DEBT & CAPITAL MARKETS

The package of measures from the EU will “target the ability of the Russian state and government to access the EU’s capital and financial markets and services, to limit the financing of escalatory and aggressive policies,” according to a statement by the bloc.

It will ban EU investors from trading in Russian state bonds.

The United States also increased restrictions on dealings in Russia’s sovereign debt. Americans, who had already been barred from investing in Russian sovereign debt directly, will now also be banned from purchasing it in the secondary market after March 1.

Britain threatened last week to block Russian companies from raising capital in London, Europe’s financial centre for such transactions, though has stopped short of doing so in its announcements on Tuesday.

Even before the latest events, access to Russian bonds had become increasingly restricted.

U.S. sanctions imposed in 2015 made future Russian dollar debt ineligible for many investors and key indexes. In April 2021, Biden barred U.S. investors from buying new Russian rouble bonds over accusations of Russian meddling in the U.S. election.

The curbs have cut Russia’s external debt by 33% since early 2014 – from $733 billion to $489 billion in the third quarter of 2021. Lower debt improves a country’s balance sheet on the surface, but deprives it of financing sources that could contribute to economic growth and development.

INDIVIDUALS

Sanctioning persons via asset freezes and travel bans is a commonly used tool and the United States, the EU and Britain already have such sanctions in place against a number of Russian individuals.

The EU on Monday imposed sanctions on five people who were involved in a Russian parliamentary election in annexed Crimea in September 2021.

On Tuesday, the bloc said it would blacklist all lawmakers in the lower house of the Russian parliament who voted in favour of the recognition of the breakaway regions, freeze any assets they have in the EU and ban them from travelling to the bloc.

Meanwhile Britain has imposed sanctions on three men, Gennady Timchenko and billionaires Igor and Boris Rotenberg – all of whom are allies of President Vladimir Putin from St. Petersburg whose personal fortunes grew precipitously following Putin’s rise to the presidency. All three men are already sanctioned by the United States.

The United States also imposed sanctions on Tuesday against Russian elites close to Putin.

Those hit by sanctions include Alexander Bortnikov, the head of the Federal Security Service, Russia’s powerful domestic security and counterintelligence service.

His son, Denis Bortnikov, the deputy president of Russian-state owned financial institution VTB Bank Public Joint Stock Company and a chairman of the bank’s management company, was also targeted in Tuesday’s move.

Also designated was Putin’s first deputy chief of staff and former Russian Prime Minister, Sergei Kiriyenko. He was previously targeted by the United States, EU and Britain in response to the poisoning of Russian opposition leader Alexei Navalny. His son, Vladimir Kiriyenko, was also designated Tuesday.

The chairman and chief executive of Promsvyazbank was also targeted. The Treasury accused Petr Fradkov of working to transform the bank into one that serves the defense industry.

While the United States has used the SDN designation in the past to sanction oligarchs deemed to be “bad actors,” it has become more cautious in recent years after 2018 sanctions on the owner of Rusal saw aluminium prices skyrocket and forced Washington to backtrack.

A bill unveiled by U.S. Senate Democrats in January aimed for sweeping sanctions against top Russian government and military officials, including Putin, and President Biden has said he would be ready to consider personal sanctions on the Russian president.

Moscow has said any move to impose sanctions on Putin himself would not harm the Russian president personally but would prove “politically destructive.”

ENERGY CORPORATES & NORD STREAM 2

The United States and the EU already have sanctions in place on Russia’s energy and defence sectors, with state-owned gas company Gazprom, its oil arm Gazpromneft and oil producers Lukoil, Rosneft and Surgutneftegaz facing various types of curbs on exports/imports and debt-raising.

Sanctions could be widened and deepened, with one possible option being to prevent companies settling in U.S. dollars.

Nord Stream 2, a recently completed pipeline from Russia to Germany, was awaiting regulatory approval by EU and German authorities before Berlin put its certification on ice.

Europe’s dependence on Russian energy supplies weakens the West’s hand when considering sanctions in this sector.

CURBING CHIPS

The White House has told the U.S. chip industry to be ready for new restrictions on exports to Russia if Moscow attacks Ukraine, including potentially blocking Russia’s access to global electronics supplies.

Similar measures were deployed during the Cold War, when sanctions kept the Soviet Union technologically backward and crimped economic growth.

SWITCHING OFF SWIFT

One of the harshest measures would be to disconnect the Russian financial system from SWIFT, which handles international financial transfers and is used by more than 11,000 financial institutions in over 200 countries.

A senior U.S. official said they are not taking SWIFT sanctions off the table.

In 2012, SWIFT disconnected Iranian banks as international sanctions tightened against Tehran over its nuclear programme. Iran lost half its oil export revenue and 30% of its foreign trade, the Carnegie Moscow Center think tank said.

Among Western countries, the United States and Germany would stand to lose the most from such a move, as their banks are the most frequent SWIFT users with Russian banks, said Maria Shagina at the Carnegie Moscow Center.

Calls to cut Russia’s SWIFT access were mooted in 2014 when Moscow annexed Crimea, prompting Moscow to develop an alternative messaging system, SPFS.

The number of messages sent via SPFS was about one-fifth of Russian internal traffic in 2020, according to the central bank, which aims to increase this to 30% in 2023. However, SPFS has struggled to establish itself in international transactions.

(Reporting by Karin Strohecker and Catherine Belton in London, Katya Golubkova and Andrey Ostroukh in Moscow; Editing by Jason Neely, Mark Potter and Lisa Shumaker)

Michiel van der Maat, Head of Corporate Solutions – Netherlands, Apex Group Ltd.

As we begin to emerge from the global pandemic, despite imminent headwinds, companies with global exposure are increasingly optimistic about the commercial opportunities beyond their domestic markets.Despite continued unpredictability, J.P. Morgan’s 2021 Business Leaders Outlook (BLO) survey shows that business leaders are adapting – and are seeking opportunities to grow globally, at the same levels as pre-pandemic levels. A report carried out by CFO research found that 45% of respondents were currently or planning to expand their business to overseas markets.

While the pandemic has been challenging for business, many have embraced more flexible business models, and with accelerated technology adoption, digitization of processes – the world remains inter-connected despite a reduction in cross-border travel.

Growing a business internationally requires long-term planning and the right support to ensure a robust platform for future growth.  Here, we ask why companies are returning to international expansion in pursuit of growth, potential challenges, and how to overcome them to make the most of these new opportunities.

Why is international expansion back on the agenda?

JP Morgan’s research shows that capturing a greater market share was the top reason business leaders cited for their desire to expand internationally, as well as increasing revenue from sales, the ability to diversify investments, and access new pools of talent.Whilst companies are largely inspired to start international business expansions to generate more revenue, there are several benefits to changing your business model and going global. Not least because the coronavirus crisis has unlocked a new digital age making it even easier to connect with potential customers in a foreign country.

With issues such as labor shortages, severe bottlenecks in global supply chains and evolving customer expectations, it can be discouraging to consider international expansion at this time. However, according to the survey, executives remain optimistic. Those surveyed cited access to new customers/markets (72%), better opportunities to serve domestic customers with global operations (37%) and access to suppliers/materials (34%) as key reasons for expansion.

What should a company consider before expanding overseas?

When expanding overseas, organizationsare typically looking for regulatory consistency, strong demand for their services& products, and a stable political and economic backdrop. Nonetheless, however attractive the business environment, youneed to be prepared before taking the plunge.

1. Getting started

The time it takes to set-upa presence in a new jurisdiction can vary significantly from country to country. In some countries it may take weeks to set up, while in other countries it may be done within a matter of days.

For example there can be differences in incorporation process,involvement of a notary, local board and shareholder representation, registered address requirements, mandatory local bank accounts, capital and registration requirementsamongst others.

Depending on the business, you will need to consider what operations will be needed in new market:  “Do you require local presence through a formal legal entity (e.g. limited liability company) or would a branch or representative office suffice?” Apart from the differences in the time, money and resources needed to set up a legal entity instead of a branch, the legal, tax and other corporate governance requirements can vary significantly.

2. Partnering with local experts

With global regulatory compliance requirements evolving rapidly, it is key to have a good understanding of how business operations may trigger obligations when entering a new market.

When operating in a new market, it’s all too easy to get caught out by new legislation and regulation. New and specific regulations may apply requiring an alphabet soup of licenses under before operations can be conducted: AIFMD, REACH, EMA/FDA, SFDR, GDPR, the list goes on…

Similarly, when expanding into a new market, you may find that most daily bookkeeping and financial reporting can still be done by a centralized finance team. However, annual statutory and tax reporting and filing obligations require local knowledge, especially when filing exemptions or extensions may exist or specific tax reporting is required.

The best way to navigate this local complexity and red tape is to work with a local expert, helping you to understandthe hoops you will need to jump through.

3. Understand global human capital

You’ll need to be aware of local employment practices and laws. Company HR policies, employee benefits and incentive plans cannot always be implemented the same way for your employeesglobally. As a result of the global pandemic, hybrid and other forms of remote working are here to stay. With more staff working from remote and across jurisdictions, global companies need to understand how rules, regulations and taxes apply differently in jurisdictions.

This is where corporate service providers can assist and provide local knowledge, and help reduce the need for local HR managerswhen employing teams in various different markets.

About Apex Group

Apex Group Ltd., established in Bermuda in 2003, is a global financial services provider. With over 50 offices worldwide and 8,000 employees upon the close of announced acquisitions, Apex delivers an extensive range of services to asset managers, capital markets, private clients and family offices. The Group has continually improved and evolved its capabilities to offer a single-source solution through establishing the broadest range of services in the industry; including fund services, digital onboarding and bank accounts, depositary, custody and super ManCo services, business services including HR and Payroll and a pioneering ESG Ratings and Advisory service for private companies.

www.apexgroup.com

North West based tech firm launches ambitious growth plans for 2022, including 40 new hires and further development and expansion of its product portfolio

Warrington, England  – Talos360 (formerly 360 Resourcing), a leading provider of intelligent talent technology solutions, that counts the likes of Homebase, Purplebricks and easyHotel as clients, has reported over 50% revenue increase for 2021, representing a record-breaking year for the North West based firm. The company, which helps clients to attract, engage and retain talent using a suite of innovative cloud-based tools, has also seen its annual recurring revenue (ARR) increase by over 80%.  It is forecast that ARR will almost double during 2022.

Talos360 also recently announced the appointment of a new Chief Revenue Officer (CRO) Dean McGlone, ex Advanced, a new Chief Financial Officer (CFO) Sam Adjepong and a new Head of People, Lyndsay Chapman, ahead of the launch of a number of new products and features for new and existing clients.

The company is also increasing the size of its product development team by over 60% in anticipation of further demand and refinement of solutions and growing sales. In 2021, the company launched Talos Engage, a new ‘self-service’ product that aims to help businesses improve their employee engagement and retention. This latest addition uses gamification to continuously explore and identify employee trends so that a business can monitor and adapt its ‘employee value proposition’, therefore helping to ensure that businesses are attracting and retaining the skills and employees they need.

The news of Talos360’s strong growth trajectory comes as UK job vacancies reach record highs. According to the Office for National Statistics, job vacancies rose to more than 1.2 million in 2021 Q4, representing an increase of more than half a million on pre-pandemic levels.

Janette Martin, CEO at Talos360, said of the news “We’re expecting 2022 to be another milestone year for Talos360. It’s clear that organisations are looking to focus more on their recruitment and retention strategies in an increasingly candidate-centric market. Not only are organisations having to cope with the so-called ‘new normal’ and the fallout from the pandemic, but they are also having to navigate the ongoing ripples and aftershocks of ‘The Great Resignation’, which saw nearly five million people voluntarily switch careers. As a result, organisations that don’t prioritise recruitment and retention in 2022 will be gambling with their future and risk getting left behind. That means thinking about recruitment strategically, seeking out pro-active solutions that will not only help them attract the best talent in the industry, but engage with candidates, understand them, and retain them long-term. Great talent is an investment for businesses – and like all investments, it should be carefully considered and protected. That’s the role we fill at Talos360.

As well as several substantial new senior appointments, we’re also planning to grow our teams across the board with more than forty new hires as we accelerate our plans for growth and continue to bring original, innovative ideas into the talent market.”

Talos360 is a market leader in talent SaaS solutions and online recruitment media. Their proprietary technology offers businesses a better way to attract, engage and retain the best teams to survive, thrive & grow.

For more information visit www.talos360.co.uk.

Leading the Industry with High Performance xHaul across 4G/5G and IP Networks

RICHARDSON, Texas – HFR Networks Inc., leading the industry with intelligent xHaul RAN Transport and Edge Access solutions, today announced that its Time Sensitive Networking Transport solution was recognized among the best by the 2022 Lightwave Innovation Reviews. An esteemed and experienced panel of judges from the optical communications community recognized HFR Networks as a high-scoring honoree.

“On behalf of the Lightwave Innovation Reviews, I would like to congratulate HFR Networks on their high-scoring honoree status,” said Lightwave Associate Publisher and Editorial Director, Stephen Hardy. “This competitive program allows Lightwave to celebrate and recognize the most innovative products impacting the optical communications community this year.”

In today’s competitive market, operators are concerned with making the most economical and efficient use of their fiber investments, in addition to gaining rapid time to market using all available assets. By optimizing the existing fiber infrastructure, HFR Networks’ solutions deliver an alternative to laying additional fiber infrastructure, which is expensive and time consuming. HFR Networks solves the many challenges associated with today’s large-scale 5G rollouts, while seamlessly converging to maximize services (4G/LTE, Wi-Fi, IP and Ethernet) over common infrastructure investments.

HFR Networks’ flexiHaul M6424 TSN-based Switch augmented with Smart Tunable Optics and xWave Optics delivers operators valuable performance advantages and flexibility. An open, standards-based, vendor-agnostic solution that enables interoperability across leading 3rd party RAN suppliers, the flexiHaul M6424 provides superior economics for xHaul services, while also providing critical 5G-compliant timing distribution.

“HFR Networks is thrilled to be recognized for our innovations over the last two consecutive years by Lightwave. HFR Networks received the highest score Lightwave assigns,” stated Paul Crann, CEO, HFR Networks. “This honor is a testament to how HFR Networks continues to lead the industry for RAN transport solutions by combining the best in packet TSN-based switching with state-of-the-art optics to deliver for our customers.”

About Lightwave
Through our integrated media portfolio, Lightwave delivers content focused on fiber optics and optoelectronics, the technologies that enable the growth, integration and improved performance of voice, data and video communications networks and services. Our experienced editorial team provides trusted technology, application and market insights to corporate executives, department heads, project managers, network engineers and technical managers at equipment suppliers, service providers and major end-user organizations. Our unique ability to inform our audience’s business-critical decisions is based in our 35+ year relationship with the entire optical community— technology vendors, communications carriers and major enterprises—and our recognition of the interplay among its members.

About HFR Networks:
HFR Networks, Inc. is leading the industry with our flexiHaul portfolio of intelligent xHaul RAN Transport and Edge Access solutions. We solve today’s most critical RAN transport demands, especially when fiber is constrained for fronthaul or backhaul applications. Our solutions have optimized economics for this segment of the network, while also delivering high performance, simplified operations, interoperability across wireless technologies, and a diverse ecosystem of 3rd party RAN suppliers. HFR Networks’ technological leadership helps customers to lower costs for 4G/LTE operations, while also accelerating new 5G and Ethernet services. We enable advanced mobile networks by utilizing nanosecond timing to connect radios using CPRI and eCPRI, within both traditional and cloud-based mobile architectures. For more information, visit www.hfrnetworks.com.

Do acts of terrorism affect the mergers and acquisitions of the companies close to where they happen? According to a recent study from Durham University Business School not only can such events bring current M&A deals to a grinding halt, the repercussions can last for up to two years afterwards, significantly damaging business prospects and local economies.

The research, conducted by Professor Dimitris Petmezas alongside colleagues from Manchester Alliance Business School and Surrey Business School, sought to explore how exogenous shocks, such as terrorist attacks, can impact local business economy due to the uncertainty they leave in their wake, and to what extent.

Professor Petmezas and his colleagues reviewed the M&A activity of firms located in and around the locations of a sample of terrorist attacks in the USA which were heavily covered by media, between 1995 and 2015. They then used Metropolitan Statistical Area (MSA) information and physical distance to measure each firm’s geographic proximity from the attacked locations.

Terrorist attacks were also rated on their severity by considering   the number of human casualties caused.

Whilst an immediate negative impact of such shocks was to be expected, the study revealed several harmful consequences for firms located near to terrorism-stricken areas when it comes to their long-term M&A prospects.

Firstly, such firms were revealed to become less attractive to potential acquirers and, as a result, were less likely to receive an acquisition bid. Furthermore, this impact was shown to last for as long as two years after the incident occurred.

Furthermore, those firms which had deals outstanding when attacks occurred were far more likely to have those deals withdrawn.

Whilst there was an argument to be made for lower-priced acquisitions becoming more desirable due to the potential to save money, the study’s findings did not support this perspective. The researchers say that acts of terrorism instead prompted acquiring firms to show preference for cross-MSA targets, or targets located farther away from where the acquirers were located, supporting the argument that target firms located in areas subject to a terrorist attack become less attractive as a result.

Furthermore, for those few firms which did manage to secure deals, the research revealed they often received a  lower acquisition premium, leaving them with less bargaining power. The research detailed how this also translated into lower target firm stock returns and lower overall acquisition synergies.

The result, according to Professor Petmezas, is a significant hit to local economies and their productivity, which can have a domino effect on workers.

Another key element, the researchers say, is human capital, which can potentially stoke the flames of terrorism-induced uncertainty, as labour productivity in firms located in terrorism-stricken areas decreases, increasing the real option value to delay M&A investments.

The researchers believe the study also highlights important lessons to be learned not only by hears on industry when it comes to deciding how to staff, market, and protect their organisations, but beyond that to local and national governments and policymakers.

Professor Petmezas says:

“Our results suggest that personal uncertainty and fear affect the acquirer-CEO’s bid decisions. Our study uncovers a negative link between terrorism intensity and acquisition premium offered which becomes more pronounced when the acquirer CEO is more risk averse or when target firms are more human capital dependent.

“Specifically, our results reveal that terrorism affects corporate investments and value creation,
indicating that it has real economic effects. For policymakers, to combat this, greater consideration and expenditures on public security and local-level investment should also be considered to give companies a firmer grounding to bounce back.”

The full study has been accepted for publication in the Management Science journal.

Speedinvest and Norrsken VC join seed round in German last mile shipping platform  

Munster, Germany: Liefergrün, the sustainable last mile shipping platform, has closed a €3 million seed round led by Speedinvest.

Liefergrün will use the investment to grow its team, expand its platform and begin preparations for rolling its service across major European cities including London, Paris and Madrid. Norrsken VC also contributed to the round.

Liefergrün, which is currently present in 30 cities across Germany, uses a fleet of cargo bikes and electric vehicles based at scores of micro distribution hubs to enable emission-free delivery of goods bought online to consumers.

By tackling the emission-heavy last mile of delivery, Liefergrün estimates that it prevents the release of 420 grams of CO2 per delivery. For context, there were 4.05 billion online deliveries in Germany alone in 2021, producing 2.43 million tonnes of CO2 or 600 grams per delivery. If Liefergrün’s sustainable approach was applied across Germany it would more than halve package delivery emissions by 1.7 million tonnes of CO2  – the equivalent of taking nearly 370,000 cars off the road each year. With online deliveries in Germany set to hit 5.7 billion by 2025 Liefergrün believes action needs to be taken now to reduce the environmental impact and enable guilt-free online shopping to continue.

Niklas Tauch, CEO and Co-Founder of Liefergrün, said: “Ecommerce has exploded over the past two years. More than 75% of Germans regularly buy products online. However, this convenience comes at a price – it’s creating a huge amount of emissions that people are rightly getting very concerned about. Simply telling people to buy less isn’t going to solve the problem. What we need to do is make ecommerce sustainable. A major part of that is tackling the last mile of delivery.

“Liefergrün is about creating a global green solution to delivery which doesn’t compromise on the quality of service to customers. This funding is an important step in our journey. It will enable us to consolidate our position in Germany and expand to other major European cities.”

Liefergrün, whose major clients include Adidas, Dyson and Every, provide a range of services including two hour and next day delivery which customers can track in real time using an app.

As well as aiming to make delivery logistics emission-free, Liefergrün is also committed to providing excellent working conditions to its staff and suppliers by paying a living wage and having strict sustainability.

Mathias Ockenfels, General Partner at Speedinvest, said: “Many cities across the world are facing the same challenge of getting a grip on the flood of deliveries that reduce air quality and make a big contribution to climate change. You only need to see how rapidly Liefergrün has grown to see just how attractive its offering is to consumers and businesses alike. It is already a big player in the 30 largest cities in Germany and we’re very excited about Liefergrün’s potential to expand across Europe.”

Fabian Erici, Investment Manager at Norrsken VC, said: “Inner-city congestion is a serious problem. It creates even more pollution, which in turn creates health issues, and increases the burden on already stretched healthcare systems. The booming e-commerce market is further escalating the problem of congestion, as last mile delivery is still mainly completed by fossil-fuel powered trucks.  Both consumers and businesses are realising how inefficient this is, and are demanding alternatives. We are happy to join Liefergrün’s mission to decarbonize our cities through green last mile delivery.”