Alphabet upsizes historic equity raise to USD85b

Good morning. Here’s what happened overnight and what you need to know today.

1.

Google upsized: Alphabet upsized its record equity raising to USD84.75 billion ($118.8 billion), about USD5 billion more than targeted, after strong demand from more than 75 investors, the Google parent said in a filing. The sale is Alphabet’s first stock offering in more than two decades and will be the largest on record, surpassing Petrobras’s USD70 billion stock sale in 2010. After strong demand, Alphabet increased the size of an offering of common and convertible share sales to USD35 billion from USD30 billion, with Goldman Sachs, JPMorgan Chase and Morgan Stanley underwriting the deal. Another USD40 billion will be sold directly into the market over time, while a USD10 billion private placement to Berkshire Hathaway remains unchanged. Nearly 40% of the proceeds will cover tax obligations tied to employee equity awards, a hidden cost of the AI talent war that is roughly double last year’s total, The Information reported. Google plans USD190 billion of capital expenditure this year on AI, with that figure expected to “significantly” increase in 2027. The success of the deal has stoked speculation that Big Tech rivals will follow suit, Reuters reported. (Capital Brief)(SEC filing)(Reuters)(FT)

2.

Tariff threat: The Trump administration proposed imposing a 12.5% tariff on Australia after an official investigation found it had failed to stop goods made with forced labour from entering its markets. The Office of the US Trade Representative, which finalised its investigation on Wednesday, alleged Australia’s policies had failed to effectively enforce a ban on slavery, making it harder for American businesses to compete fairly. Australia already faces a 10% tariff on goods exported to the United States, though that measure is due to expire in July, making the proposed 12.5% levy its likely successor. The tariff is not yet in force, with the Trump administration seeking public submissions and holding hearings before deciding whether to proceed. A government source speaking on condition of anonymity told The Australian Financial Review it was unclear whether the 12.5% levy would apply to products where Australia had previously been granted an exemption, including beef and gold. A spokesman for Trade Minister Don Farrell said Australia maintained that any tariffs on its exports to the US were inconsistent with the two countries’ free trade agreement. “Australia has robust, comprehensive and world-leading legislation addressing forced labour and modern slavery,” the spokesman said. Brazil, China, India, Japan, New Zealand and South Korea are among the 54 countries facing the same proposed levy. (Capital Brief)(AFR)