Juul admits defeat

MARKETS

• Global economy: See that red? Chalk it up to concerns over weakening economic growth globally—China's top auto industry association said sales in the country fell for a fourth straight month in October.

MEDIA

Fortune Goes for $150 Million

A cheat sheet to get your name in the Brew:

1. Buy a business-focused media property
2. Have your purchase reflect a wider trend that we can "zoom out" on

Congratulations, Mr. Chatchaval Jiaravanon. You've done it. Welcome to the Brew.

The Thai businessman bought Fortune magazine from Meredith Corp. for $150 million in cash. The motivation? A "personal private investment."

Let's take a closer look at that investment

Fortune is what we like to call a "legacy" media brand, which carries both positive and negative connotations.

• The positive: It's been around a long time—since 1930 to be exact. Fortune's longevity is a result of its CEO profiles, prominent rankings (like the "Fortune 500"), global presence, and well-attended events.
• The negative: The digital age has thrown Fortune for a loop. It'll print only 12 issues this year, its paid circulation is down, and even web traffic to Fortune.com has slowed since 2016, per the WSJ. Last year, digital ads and conferences accounted for 62% of its revenue (which is expected to brush up against $100 million this year).

This sale shouldn't come as a major surprise

Some background: Meredith acquired Fortune as part of its purchase of Time Inc. earlier this year.

But that relationship was going nowhere from the start, since Meredith was actively looking to offload Fortune, along with newly acquired Time, Money, and Sports Illustrated. With Salesforce CEO Marc Benioff scooping up Time last month...it's now two down, two to go.

What's raising eyebrows: The price. At 15x EBITDA (earnings before interest, taxes, depreciation, and amortization), it's a serious premium. But there may be an angle for Mr. Jiaravanon here, according to Dan Primack of Axios.

• "Fortune is one of perhaps only two business brands with high name recognition in both the U.S. and Asia: Fortune publishes its own China edition, and regularly hosts conferences there."

Zoom out, per the NYT: "That a little-known businessman like Mr. Jiaravanon would become Fortune's new owner underscores the wildly shifting prospects for America's best-known magazines."

ENERGY

Keystone XL Pipeline Foiled (Again)

TransCanada's Keystone XL pipeline has been in limbo for over a decade...but it just got dealt a body blow.

What happened: A federal district court judge in Montana halted the project, saying the Trump administration needs to provide an updated environmental analysis before moving forward.

• Remember, Keystone XL's a proposed $8 billion, 1,000-mile expansion of the existing Keystone oil pipeline. It would carry 800,000+ barrels/day from Alberta's oil sands to Nebraska.

Rewind: The pipeline has been a flashpoint for both Big Oil (who will be licking their wounds) and environmentalist/indigenous groups (who will count this as a win). Former President Obama blocked Keystone XL in 2015...but President Trump revived it two days after taking office.

Fast forward: The Trump administration will have to revisit potential impacts on climate change, cultural resources, and endangered species for the project to get up and running again.

E-COMMERCE

Alibaba’s Singles Day Could Hit a Snag

You know the old adage—"If you can't be with the one you love, buy yourself a juicer." That Jack Ma...he's always had a way with words.

Alibaba (-2.78%), the Chinese internet behemoth Ma co-founded, will launch its 10th annual Singles Day starting at midnight to celebrate—you guessed it—being alone. But instead of bawling into a box of chocolates, Chinese singles (and plenty more) spend money.

• Singles Day hauled in $25.3 billion in sales last
• For context, Americans spent $19.6 billion online shopping the entire five days from Thanksgiving through Cyber Monday in 2017.

But Ma's sweating a little this time around. The Chinese economy is slowing, consumer sentiment is in a rut, and, oh yeah, there's that trade war with the U.S.

• Consulting firm Oliver Wyman found 38% of Chinese millennials plan to spend less on the holiday this year.

Still, Baba's pledging this Singles Day (with deals on everything from Whirlpool fridges to Starbucks coffee) will be the largest ever in terms of "scale and reach."

E-CIGARETTE

FDA: 1, Juul: 0

Juul Labs—the e-cigarette unicorn leading the monster vaping trend—will stop selling most of its flavored nicotine pods at brick-and-mortar retail spots, per the WSJ.

• What came first: Tough scrutiny from the FDA, which has criticized Juul and other e-cig companies for their roles in the "epidemic" of teen vaping.
• What comes next: The FDA's reportedly prepping to announce sharp restrictions on the sale of e-cig products soon.

Before everyone goes all Black Friday on the local 7-Eleven, consider this: Juul is only axing its fruity flavors (teen favorites like cucumber and mango) from retail shelves. Menthol and tobacco flavors will stick around, plus all flavors will be available online (where Juul has age-verification tools to keep out anyone under 21).

+ While we're here: The FDA reportedly plans to go after a ban on menthol cigarettes, too—though it could take as long as two years before that would be enforced.

MANUFACTURING

So That's How They Make It...

WHAT ELSE IS BREWING

• GE (-5.56%) can't catch a break...JPMorgan cut its price target to just $6/share.
• President Trump reportedly wants to replace Commerce Secretary Wilbur Ross by the end of the year, per CNBC.
• Amazon and Apple struck a new deal that'll put more of Apple's latest products on Amazon's e-commerce platform.
• Walmart (+0.65%) is building an AI-powered "Intelligent Retail Lab" in one of its stores.
• Facebook (-1.97%) is ending its policy of requiring employee sexual harassment claims to be settled in private arbitration, per the WSJ. Remember, Google did the same this week.

BREAKROOM

From the Crew
Today, we're thinking about everyone in California enduring a tragic week.

• First, we're remembering the victims of the mass shooting in Thousand Oaks: Sgt. Ron Helus, Sean Adler, Cody Coffman, Alaina Housley, Dan Manrique, Justin Meek, Kristina Morisette, Blake Dingman, Telemachus Orfanos, Noel Sparks, Jake Dunham, and Marky Meza Jr.
• We're also sending our best wishes to those affected by the wildfires throughout the state. Stay safe.

Saturday Headlines
All of these headlines are real...except one. Can you guess which one is made up?

• "Runaway mining train in Australia travels 90km without driver"
• "Voters choose dead pimp over Democratic opponent"
• "Entering the fray: Led Zeppelin has reunited to release a diss track aimed at Drake"
• "69-year-old sues to legally change his age to 49, citing Tinder benefits"

(Answer located at bottom of newsletter)

Breakroom Answers