Andrew here. Wall Street and the New York business community got its wish when Mayor Eric Adams dropped his re-election bid. But the truth is that it is probably too late to change the outcome, which clearly favors Zohran Mamdani, the democratic socialist who is the Democratic nominee for mayor.
Andrew Cuomo will most likely pick up much of Adams’s support, but it is still a small number of votes. And consider this: The louder the business community speaks out against Mamdani, the more it could backfire and raise his popularity among other voters. We’ve got a lot more on all of this below, as well as new details about a new deal that’s just broke on Monday morning, that could be the largest leveraged buyout in history.
The field narrows
Mayor Eric Adams has called off his re-election bid, after weeks of pressure to drop out.
That could help Andrew Cuomo, who has drawn support from high-powered donors who want to stop Zohran Mamdani, the Democratic nominee. But it’s unclear whether Adams dropping out will get them what they want.
“Despite all we’ve achieved, I cannot continue my re-election campaign,” Adams said in a nearly nine-minute video yon Sunday. He blamed “continued media speculation about my departure” and his inability to get public matching funds. (That said, there were numerous scandals that have dogged his administration, as well as Adams’s divisive efforts to court President Trump.)
Adams didn’t endorse any candidates, though the video he posted on social media omitted sharp criticism of Cuomo that were in prepared remarks circulated to the news media beforehand. In those remarks, Adams said that politicians who waffled on key issues and sought to push others aside in their quest for power “cannot be trusted.”
Their exclusion left open the possibility that Adams might eventually endorse Cuomo.
Adams had felt pressure from wealthy business leaders, who had increasingly come to believe that the mayor and Cuomo were splitting the anti-Mamdani vote. Among them was Bill Ackman, who had held talks with both Adams and Cuomo before backing the former governor.
The Trump administration even weighed in, discussing a potential ambassadorship for Adams if he dropped out, The Times has reported.
“Thank you @ericadamsfornyc for your service for our city and for stepping aside when the time was right!” Ackman wrote on social media yeon Sunday.
Will it matter? Recent polling showed Mamdani drastically ahead when he faced Cuomo, Adams and the Republican candidate, Curtis Sliwa. The math changes if the field narrows, The Times’s Nate Cohn previously reported.
But Sliwa is still in the race, and has shown no interest in dropping out despite calls by Ackman and others. And even with polling analyses suggesting that Cuomo has a better chance now, bettors in prediction markets — which have been praised for correctly nailing the outcome of the 2024 presidential election — think Mamdani is still highly likely to win. His odds of winning are currently at 85 percent on Polymarket.
Mamdani himself appears unfazed. “To Andrew Cuomo, you got your wish: You wanted Trump and your billionaire friends to help you clear the field,” he said in a video posted to social media. “But don’t forget, you wanted me as your opponent in the primary, too, and we beat you by 13 points. Looking forward to doing it again on November 4th.”
HERE’S WHAT’S HAPPENING
President Trump is set to meet on Monday with congressional leaders as a shutdown looms. Both parties seem far apart before a deadline to reach a funding agreement. Democrats want to see health care benefits extended and are proposing to reverse cuts to Medicaid, while Trump has threatened to fire scores of government employees if a deal isn’t reached. Investors are growing concerned that a shutdown could interrupt the release of government data.
Could Microsoft become a new target for presidential retribution? Trump said the company should fire Lisa Monaco, a top official in the Obama and Biden administrations whom it hired as a president of global affairs. Microsoft has mostly stayed in Trump’s good graces, but Monaco’s hiring was pointed out by the right-wing influencer Laura Loomer, who urged the president to cancel the tech giant’s government contracts — and Trump has become even more combative toward those out of his favor.
The heat is rising for Jay Powell. Trump, who has repeatedly harangued the Fed chair for not lowering interest rates, posted on social media on Saturday a cartoon depicting him firing Powell. The broadside comes as several Fed policymakers, including Powell himself, have expressed concerns about making too many rate cuts as inflation hovers above the central bank’s 2 percent target. Many economists increasingly expect Trump to replace Powell with a loyalist when the chair’s term expires in May.
A megadeal at an inflection point for private equity
Electronic Arts, the struggling video game maker, has just closed a deal to take itself private, at a valuation of around $55 billion including debt. That would be perhaps the largest leveraged buyout, breaking a record set during the height of the private equity boom in 2007.
But a transaction would occur a time when the private equity industry’s fortunes are diverging.
What we know so far: The Times and others had reported that Electronic Arts is in talks to sell itself to a group that includes Silver Lake, the tech-focused private equity giant; the Public Investment Fund, the Saudi sovereign wealth fund that already owns a roughly 10 percent stake; and Affinity Partners, the investment firm founded by Jared Kushner in 2021.
The company confirmed those details on Monday, and said shareholders would receive $210 per share, a roughly 25 percent premium on Thursday’s closing share price.
The L.B.O. will be supported by $20 billion worth of financing arranged by JPMorgan Chase. The Financial Times had previously reported that detail.
The potential takeover comes at a time of optimism for deal-making. Wall Street has largely shaken off its worries about tariffs and uncertain application of antitrust enforcement. Big deals have been struck in recent months, including Union Pacific’s $85 billion takeover of Norfolk Southern and Keurig Dr Pepper’s $18 billion acquisition of Peet’s.
Investors are also clamoring for a piece of the financing package that JPMorgan is arranging, according to The F.T. “It’s the perfect time to do this deal,” one unnamed lender told the newspaper. “There’s so much demand for paper.”
But the private equity industry itself is a tale of two halves. The winners, including Silver Lake, Blackstone, Apollo Global Management, KKR and EQT, are riding high, striking deals and raising huge funds.
Others are struggling on multiple fronts. They’re finding it harder to find attractive takeover candidates, and to cash out investments they have already made, which makes it trickier to return money to impatient investors. That has translated into trouble for some firms in raising new funds, an ominous sign.
The industry could see a “natural washout,” according to Jim Zelter, Apollo’s president. “I think there’s many, many P.E. funds that are out there that have raised their most recent fund and don’t realize it’s their last fund,” he said at a conference this month.
Meanwhile, as the Electronic Arts deal illustrates, the winners might just keep on going.
“The scale of this investment and the fact that it’s being made into only one customer raises the question of — are they stimulating artificial demand, which won’t be sustained over time and could produce some severely negative returns down the road?”
— David Yoffie, a professor at Harvard Business School and a former Intel board member, on where Nvidia’s huge investment spree, including a pledge last week to invest up to $100 billion in OpenAI, could be distorting just how much demand there is for its chips.
Exclusive: Coinbase takes on the banks
Crypto companies spent heavily to get the Genius Act passed this summer, a landmark law that established regulations for stablecoins. Now, they’re lobbying hard to preserve that victory.
Coinbase on Monday introduced an influence campaign aimed at U.S. senators, Niko Gallogly is first to report. Its message? Don’t let the banks close a provision that is key to crypto companies’ stablecoin business, an area of digital finance that some predict could grow to roughly $2 trillion by 2028.
The campaign is the latest escalation in a high-stakes policy fight between the crypto and banking industries. Congress passed the Genius Act in July, a law intended to bring stablecoins — digital tokens tied to stable financial assets, including the dollar and U.S. Treasury securities — into the mainstream.
But the law prohibits stablecoin issuers like Circle and Tether from paying interest on those assets, as banks do with many ordinary deposit accounts. The crypto companies got around this by offering customers other financial incentives. For example, Coinbase customers who hold USDC (the stablecoin issued by Circle) can earn 4.1 percent in “rewards.”
Banks are pushing back. They argue that such earnings are an unregulated payment. Their lobbyists have called it an “interest loophole,” and have asked Congress to put an end to the practice.
The stakes are immense. Consumers could move as much as $6.6 trillion from bank deposit accounts into stablecoins if stablecoins were interest-bearing, the Treasury Department has estimated. Such a shake-up “would end up increasing lending costs and reducing loans to businesses and consumer households,” the Bank Policy Institute, a banking trade group, warned in a letter last month.
Coinbase, for one, wants to mobilize crypto investors against the banks. Its new campaign makes use of playful social media videos and email and push notifications to its millions of customers. “I think the reaction should be quite intense” from crypto users, Faryar Shirzad, the chief policy officer at Coinbase, told DealBook.
The campaign is being organized in partnership with the nonprofit organization Stand With Crypto, an industry group that is backed by Coinbase and other industry players that became a huge lobbying force for crypto-friendly politicians, including President Trump.
THE SPEED READ
Deals
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Occidental Petroleum is said to be in talks to sell its OxyChem petrochemicals division for roughly $10 billion. (FT)
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The crypto exchange Kraken is reportedly looking to raise funding at about a $20 billion valuation, much more than what it was valued at just a few months ago. (Bloomberg)
Politics, policy and regulation
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“Why Microsoft Has Lower Borrowing Costs Than the U.S.” (WSJ)
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Dominion Voting Systems has settled its defamation lawsuit against Rudy Giuliani. Terms were not disclosed, but the company originally sought $1.3 billion in damages. (NYT)
Best of the rest
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What Oura Health’s C.E.O. has learned about the secret to better sleep — and why he’s not that concerned about competition from Apple or another major tech company. (NYT)
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Paul Thomas Anderson’s new film, “One Battle After Another,” took in an estimated $22 million at the North America box office in its debut — but cost far more to make. (NYT)
We’d like your feedback! Please email thoughts and suggestions to [email protected].
Andrew Ross Sorkin is a columnist and the founder of DealBook, the flagship business and policy newsletter at The Times and an annual conference.
Bernhard Warner is a senior editor for DealBook, a newsletter from The Times, covering business trends, the economy and the markets.
Sarah Kessler is the weekend edition editor of the DealBook newsletter and writes features on business.
Michael J. de la Merced has covered global business and finance news for The Times since 2006.
Niko Gallogly is a Times reporter, covering business for the DealBook newsletter.
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