By Ludwig Burger and Riham Alkousaa

(Reuters) – German healthcare group Fresenius has cut its 2022 guidance for the second time on persistent cost inflation and staff shortages with its new CEO pledging a review of all its diversified businesses.

The company’s shares gained 5.7% on Monday, bouncing back from a drop on Friday, on hopes that a new leadership team will right the ship.

In a statement on Sunday, the drugmaker and healthcare services company said its adjusted net income would likely fall 10% this year, excluding foreign exchange effects, having previously indicated a decline in a “single-digit percentage range” at worst.

Efforts to stem ballooning costs and ease a staff shortage at Fresenius Medical Care (FMC), a U.S. focused kidney dialysis provider, would take longer than expected, the company said.

But other businesses, in particular hospital project developer Vamed, were hit by cost inflation, staff shortages and supply chain disruptions, it added.

FMC now expects net income to decline in the high-teens to mid-20s percentage range this year, down from its previous outlook of a high-teens percentage drop.

The new chief executive at parent Fresenius, Michael Sen, who started this month, said he had embarked on a “top-to-bottom” review of all business activities, with a focus on profitability.

“This will not happen overnight, but we will move at a faster pace and more decisively than ever before,” said Sen.

His initial attention would be on cutting costs and activities that do not contribute to the group’s focus on return on capital would be stopped or divested, he said in an analyst call.

JPMorgan analysts said in a note this indicated “greater scope for strategic change” which is likely to be viewed positively.

Investors had braced for bad news as shares in FMC’s closest U.S. rival DaVita plunged 27% on Friday. It cut its 2022 guidance, predicting adjusted operating income of $1.375-$1.45 billion, a decline of as much as 23% from 2021.

FMC and Fresenius shares had fallen 8.9% and 3.2% on Friday, respectively.

Activist investor Elliott has taken a stake in Fresenius, a person familiar with the matter told Reuters this month, sparking speculation it might push for a break-up.

Elliott declined to comment.

Dialysis provider FMC is also under new leadership, with CEO Carla Kriwet pledging to improve performance and accountability.

“There is also a clear urgency to turnaround our operational performance with bold interventions,” she said.

The dialysis company was also hit by the coronavirus pandemic, with about 24,600 COVID-related deaths among its patients since the start of the pandemic.

($1 = 1.0037 euros)

(Reporting by Ludwig Burger and Riham Alkousaa, Editing by Angus MacSwan, Kirsten Donovan)

By Nate Raymond

(Reuters) – The U.S. Supreme Court is set to consider whether colleges may continue to use race as a factor in student admissions in two cases that give its conservative majority a chance to ban policies often employed to boost Black and Hispanic enrollment and perhaps overturn its own precedents allowing such practices.

The justices, confronting another contentious issue in U.S. American society, are scheduled to hear arguments on Monday in appeals by a group backed by a conservative activist of lower court rulings upholding affirmative action admissions policies at Harvard University and the University of North Carolina.

Many U.S. colleges and universities place a premium on achieving a diverse student population not simply to remedy racial inequity and exclusion in American life but to bring a range of perspectives onto campuses with the goal of a richer educational experience for everyone. Critics argue that these policies themselves amount to unlawful racial discrimination.

According to Harvard, around 40% of U.S. colleges and universities consider race in some fashion in admissions.

The Supreme Court has been upheld such policies, most recently in a 2016 ruling involving a white woman who sued after the University of Texas rejected her. The court has shifted rightward since then. Its 6-3 conservative majority includes three justices who dissented in that 2016 decision and three appointed by Republican former President Donald Trump.

The Harvard and UNC lawsuits were filed in 2014 by a group called Students for Fair Admissions founded by anti-affirmative action activist Edward Blum, who also backed the University of Texas plaintiff. Blum said he is not taking a ruling against the schools for granted, adding, “Trying to foretell what the court is going to do is a fool’s errand.”

Ruling in favor of the plaintiffs could require the court to overturn its 2016 ruling and earlier decisions.

The court in 1978 ruled in a case called Regents of the University of California v. Bakke that race could be considered as one of several admissions factors including academic and extracurricular criteria but barred racial quotas. It reaffirmed that in a 2003 ruling in a case called Grutter v. Bollinger.

The court’s conservative bloc has shown a willingness to abandon precedent, as illustrated in the June decision to overturn the 1973 Roe v. Wade ruling that had legalized abortion nationwide.

‘DIVERSITY AND INCLUSION’

The lawsuits accused UNC of discriminating against white and Asian American applicants and Harvard of discriminating against Asian American applicants.

“These challenges are a part of a broader attack on the importance and value that the Constitution and that American society place on diversity and inclusion in the core institutions of our society,” said Sarah Hinger, an attorney with the American Civil Liberties Union, which has filed briefs in the cases supporting the schools.

Democratic President Joe Biden’s administration is backing the schools.

Students for Fair Admissions cited Harvard data showing that Asian American applicants were less likely to gain admission than white, Black or Hispanic applicants with similar qualifications. It said UNC’s admissions data showed “stark” racial disparities in acceptance rates among similarly qualified applicants, with Black and Hispanic students preferred over white and Asian American ones.

Blum’s group has argued that Harvard’s policies ran afoul of Title VI of the Civil Rights Act, which bars racial discrimination under any program receiving federal financial assistance, and that UNC’s violated the U.S. Constitution’s 14th Amendment’s guarantee of equal protection under the law.

The lower courts disagreed. For instance, the Boston-based 1st U.S. Circuit Court of Appeals found that Harvard’s use of race was “meaningful” and not “impermissibly extensive” because it prevented diversity from plummeting.

Chief Justice John Roberts is seen as the conservative justice least inclined to overturn precedent. But he dissented in the 2016 ruling alongside fellow conservative Justices Clarence Thomas and Samuel Alito.

Thomas, one of the court’s two Black justices, has been outspoken against racial preferences.

“The Constitution abhors classifications based on race, not only because those classifications can harm favored races or are based on illegitimate motives, but also because every time the government places citizens on racial registers and makes race relevant to the provision of burdens or benefits, it demeans us all,” Thomas wrote in a Grutter v. Bollinger ruling dissent.

Michaele Turnage Young, a lawyer with the NAACP Legal Defense and Educational Fund, which has filed briefs supporting the schools, said the court could rule more narrowly than its 6-3 ideological split might suggest, particularly after the political backlash from the abortion ruling.

“The court might be wary of overturning another longstanding federal line of precedent,” she said.

David Bernstein, a professor at George Mason University’s law school who has filed a brief supporting Blum’s group, said he would be watching to see if the three liberal justices can find “some escape hatch or limit” to allow some form of racial preferences to remain.

Liberal Justice Ketanji Brown Jackson, the court’s other Black member, has recused herself from the Harvard case but is set to participate in the UNC one. Jackson, the newest justice, attended Harvard and previously served on its Board of Overseers.

(Reporting by Nate Raymond in Boston; Editing by Will Dunham)

By Sumit Khanna

MORBI, India (Reuters) – Indian police arrested nine people on Monday, including ticketing clerks and contractors, as they investigate the collapse of a foot bridge in which at least 134 people, including many children, were killed.

CCTV footage from just before the collapse showed a group of young men taking photos while others tried to rock the suspension bridge in Morbi from side to side, before they tumbled into the river below as the cables gave way.

The colonial-era bridge over the Machchhu River was packed with sightseers enjoying holiday festivities when it ruptured on Sunday evening, sending people plunging about 10 metres (33 feet) into the water.

Ashwin Mehra, who was undergoing treatment after sustaining leg and back injuries, said he and six others had reached the shore by holding onto the bridge’s metal railings and netting.

“There were about 15-20 boys aged between 20-25 years who were shaking the bridge,” he told Reuters TV partner ANI. “…We heard some sounds three times, and the sixth time the cable (of the bridge) suddenly snapped.”

A senior police official said nine people had been arrested, including managerial staff, ticketing clerks and three security guards, for failing to regulate crowds before the bridge crumpled.

Two people awarded a contact to repair the structure, originally built in 1877, were among those arrested, Ashok Kumar Yadav said. He said there were likely to be more arrests.

Shock and grief at the tragedy was mixed with anger from some of the loved ones of those killed and members of the opposition in the western state of Gujarat, where elections are due by early next year.

“Not just extremely sad on bridge collapse in Morbi but also very angry. Because it was a tragedy in waiting,” Gurdeep Singh Sappal, a member of the Congress party, wrote on Twitter.

“For some time now, bridge collapse, roads caving-in, dams breaching are happening quite often.”

Prime Minister Narendra Modi, who hails from the state where the disaster occurred, is due to visit the small industrial town on Tuesday, a lawmaker said.

Local officials told Reuters that Oreva, a company which makes clocks and electrical items that was in charge of the bridge, had not informed the authorities that it would be reopened last week after repairs, adding that no certificate that it was fit for public use had been issued.

An Oreva spokesperson did not answer calls and text messages from Reuters.

The Indian Express newspaper quoted an Oreva spokesperson as saying: “While we are waiting for more information, prima facie, the bridge collapsed as too many people in the mid-section of the bridge were trying to sway it from one way to the other.”

Graphic: Gujarat bridge collapse https://graphics.reuters.com/INDIA-ACCIDENT/BRIDGE/gdvzqrnxypw/graphic.jpg

‘HOUR OF GRIEF’

Some 400 people had bought tickets to get onto the bridge to celebrate the Diwali and Chhath Puja festivals.

About 35 victims were under 14, according to a list of the deceased seen by Reuters. About 170 people had been rescued by the morning.

“People were hanging from the bridge after the accident, but they slipped and fell into the river when it collapsed,” said Raju, an witness who gave only one name. “I could not sleep the entire night as I had helped in the rescue operation. I brought a lot of children to the hospital.”

Narendrasinh Jadeja, whose friend lost seven members of his family, including four children, said: “I cannot express how angry and helpless I am feeling.”

Senior government official N.K. Muchhar said the death toll had gone up to 134. Another official said at the site that the river’s muddy waters were hampering rescue work and that there might be people trapped under the remains of the bridge.

Oreva, a Gujarat-based company, had been in charge of maintaining the bridge for 15 years, said Sandeepsinh Zala, the chief officer of Morbi municipality.

“They did not give us any information that they were reopening the bridge,” Zala said. “We have not issued any fitness certificate to them.”

Jayrajsinh Jadeja, a local lawmaker from Modi’s Bharatiya Janata Party, blamed Oreva for selling tickets without restrictions and said overcrowding led to the bridge collapse.

The bridge was previously maintained by the local municipality, which limited the number of people on the bridge at one time to 20, he said.

Modi, the former chief minister of Gujarat, expressed his condolences to the victims’ families.

“In this hour of grief, the government is with the bereaved families in every manner,” he said at an event in Gujarat.

The bridge is 1.25 metres (4 feet) wide and spans 233 metres (255 yards) and connected the Darbargadh Palace heritage hotel and the town.

(Writing by Sudipto Ganguly in Mumbai; Editing by Kim Coghill, Gerry Doyle, Edmund Klamann and Alison Williams)

By Jan Lopatka

PRAGUE (Reuters) -The European Union asked the United States on Monday to treat EU electric vehicles, batteries and sustainable energy equipment sold in the United States the same as those from Canada and Mexico, Czech trade minister Jozef Sikela said.

The 27-nation EU has been complaining the U.S. Inflation Reduction Act effectively discriminates against EU producers because it offers tax breaks to consumers on such goods made in North America, but not for those made in the EU.

The EU argues that, unlike the United States, it offers the same tax breaks for EU-made and U.S.-made goods in these sectors.

Speaking after a meeting of EU trade ministers and U.S. Trade Representative Katherine Tai in Prague, Sikela, whose country holds the rotating presidency of the EU, told a news conference there was a willingness on both sides for a deal.

“We are expecting a derogation (in the U.S. Inflation Reduction Act) for EU member states – ideally we would like to have the same as Canada and Mexico, but we have to be realistic and see what we can negotiate,” Sikela said.

The issue is to be resolved by a special task force, which will meet for the first time this week, EU Trade Commissioner Valdis Dombrovskis said.

“We are focusing on a negotiated solution before we move on to other considerations,” he said.

(Reporting by Jan Lopatka; Editing by Nick Macfie and Mark Potter)

By Michel Rose

PARIS (Reuters) -Elon Musk has assured the European Commission that Twitter will abide by tough European rules on illegal online content policing now that the social network has passed under his ownership, European Union sources said on Monday.

In a previously unreported exchange last week, Musk told Thierry Breton, the EU’s industry chief, that he planned to comply with the region’s Digital Services Act, which levies hefty fines on companies if they do not control illegal content.

The self-described free speech absolutist agreed to hold a meeting with Breton, a former French finance minister, in the coming weeks, two EU officials familiar with the discussions told Reuters. The exchange came after Breton took to Twitter to warn Musk about the new European legislation on Friday. “In Europe, the bird will fly by our EU rules,” Breton tweeted on Friday.

EU lawmakers approved the landmark rules to rein in tech giants over the summer, which will require online platforms to do more to police the internet for illegal content, with big platforms required to have more moderators than small ones.

Companies will face fines of up to 6% of annual global turnover for breaches of Digital Services Act. The assurances from Musk appeared to suggest a pragmatic attitude from the CEO of electric car maker Tesla Inc, who has previously expressed his desire to see Twitter with fewer limits on content.

Musk has so far offered little details on how he will run the company after his $44 billion buyout.

He has said he plans to cut jobs, leaving Twitter’s 7,500 employees fretting about their future. He also said on Thursday he did not buy Twitter to make more money but “to try to help humanity, whom I love.”

Breton and Musk had met in May, and the two had signalled at the time agreement on complying with EU regulation.

In a video posted on Twitter by Breton after their May meeting, the EU official says he explained the Digital Services Act to Musk. “It fits pretty well with what you think we should do,” Breton said. “I think it’s exactly aligned with my thinking,” Musk responded in the May video.

(Reporting by Michel RoseEditing by Matt Scuffham, Ingrid Melander and Tomasz Janowski)

By Hannah Lang

(Reuters) – Apollo Global Management Inc has begun holding cryptocurrency on behalf of its clients through a partnership with digital asset platform Anchorage Digital, in a major push by one of the world’s largest asset managers to bring crypto to institutional investors.

The move comes despite a rocky year for the crypto market, with bitcoin, the world’s largest digital asset, down more than 50% since the start of 2022, as investors have appeared jittery about decades-high inflation across the globe.

“It’s the validation of this incessant drumbeat that [crypto] is here to stay,” said Diogo Mónica, president of Anchorage Digital, a crypto firm that holds a national trust bank charter from the Office of the Comptroller of the Currency. “This is a very long-term horizon process and technology and that for the large institutions, it doesn’t really matter that there is volatility short term.”

Apollo, which declined to disclose what types of crypto assets it holds, said its relationship with Anchorage dates back to the middle of last year, when the firm first began exploring how best to safeguard its clients’ crypto assets. Apollo later participated in Anchorage’s Series D funding round, which was finalized in December 2021.

“As we explore creative ways to apply blockchain technology across Apollo’s business, we look forward to collaborating with Anchorage for the safekeeping of client assets,” said Adam Eling, chief operating officer of Apollo’s digital assets team.

Mónica said Anchorage is also engaged with discussions about how to potentially further expand its relationship with Apollo in the future.

In April, Apollo hired former JPMorgan Chase executive Christine Moy, who will lead digital asset strategy across the business, and play a key role in its investment decisions in crypto, blockchain and Web3, a decentralized version of the internet.

(Reporting by Hannah Lang in Washington; Editing by Lananh Nguyen and Diane Craft)

(Clarifies wording in paragraph 6)

By Summer Zhen

HONG KONG (Reuters) – Bond fund managers with strategies focused on Asian high-yield issuers have switched to cash and other non-China assets after suffering huge losses in China’s corporate bond market.

Once a sought-after investment that accounts for more than half of Asia’s high-yield corporate bond issuance, China’s property sector saw a record number of defaults in 2022 across top private developers and even some state-owned companies.

Capital outflows triggered by aggressive Federal Reserve interest rate hikes struck another blow to the already fragile segment.

Monica Hsiao, founder and chief investment officer of Triada Capital, an Asia-focused credit long-short fund, says she has not seen this kind of challenge in an investment career spanning more than 20 years.

“We hold over 50% of cash at the moment, higher than any time historically,” said Hsiao, who founded the fund in Hong Kong in 2015.

Hsiao, who managed Asia credit for London-based credit-focused asset manager CQS prior to setting up Triada, did not disclose the fund’s size and its performance.

More than two dozen Chinese property developers rated by Moody’s have defaulted since the beginning of 2021 and that has pushed the number of Asian high-yield companies rated junk to a record high.

Many holders of China high yield bonds have seen them trading below 20 cents on the dollar. The in-default bonds of property company Sunac China maturing in 2025 trade at 6 cents to a dollar.

The average return of the top 10 Asia high yield bonds is down more than 30% this year, Morningstar data shows, of which Fidelity Funds’ Asian High Yield Fund and UBS’s SICAV – Asian High Yield (USD) had shed more than 40% as of Oct. 27.

The property sector, crucial to China’s political and economic stability, has seen sharp declines in prices and sales after policymakers imposed strict curbs on borrowing by developers in mid-2020.

Hsiao said investors were hoping for policy measures to prop up real estate demand this year but that didn’t happen.

Hsiao kept reducing her fund’s China exposure from the first quarter and shifted to cash in the summer months, when the U.S. inflation threat and geopolitical risks increased.

‘UNINVESTABLE’ ASSET CLASS

Gordon Ip, chief investment officer for fixed income at asset manager Value Partners，says the fund has reduced overall exposure to China property and bought Indonesian and Indian bonds this year, mostly in energy or resources and renewables sectors.

Value Partners’ Greater China High Yield Income Fund was down 37% as of the end of September. The fund’s assets have fallen to $611 million from $980 million at the end of April.

“This has been an extraordinary year in terms of managing risks,” said Ip. “Rising rates, skyrocketing inflation, geopolitical tensions and intense sector risk (China property) have made it extremely challenging to navigate the market.”

Ip said the fund has been staying liquid by trying not to “over own” a particular issue and making sure it always has a reasonable level of cash.

Bond investors are generally sitting tight and already looking ahead to next year, said Nicholas Yap, head of Asia Flow Credit Desk Analysts at Nomura.

Investors do not see China’s property debt markets reviving anytime soon, given not just regulatory risks but also several developers’ differentiated treatment of onshore and offshore bondholders in the restructuring process.

“There is no reliable restructuring process in China that coordinates between onshore and offshore,” said Hsiao, adding she sees barely any willingness among defaulted issuers to negotiate.

While there are select bonds that have upside, China high yield as an asset class is currently “uninvestable”, she said.

“We’re right in the perfect storm. We hope for the best, but prepare for the worst,” she said.

(This story has been refiled to clarify wording in paragraph 6)

(Reporting by Summer Zhen; Editing by Vidya Ranganathan and Muralikumar Anantharaman)

(Reuters) – Twitter will revise its user verification process, Elon Musk said in a tweet on Sunday, just days after he took over one of the world’s most influential social media platforms.

“Whole verification process is being revamped right now”, Musk said in his tweet without giving more details.

Twitter is considering charging for the coveted blue check mark verifying the identity of its account holder, technology newsletter Platformer reported on Sunday, citing two people familiar with the matter.

Users would have to subscribe to Twitter Blue at $4.99 a month or lose their “verified” badges if the project moves forward, according to the report.

The CEO of Tesla Inc has not made a final decision and the project could still be scrapped but according to Platformer it is likely that verification will become a part of Twitter Blue.

Separately, The Verge reported on Sunday that Twitter will increase the subscription price for Twitter Blue, which also verifies users, from $4.99 a month to $19.99 a month, citing internal correspondence seen by them.

Twitter Blue was launched in June last year as the platform’s first subscription service, which offers “exclusive access to premium features” on a monthly subscription basis including an option to edit tweets.

The feature to edit tweets was also made available earlier this month after Musk launched a Twitter poll in April asking his millions of followers whether they wanted an edit button. Over 70% had said yes.

Musk has also requested that logged out users visiting Twitter’s site be redirected to Explore page which shows trending tweets, according to a separate Verge report on Sunday citing employees who were familiar with the matter.

(Reporting by Akanksha Khushi in Bengaluru; editing by Diane Craft and Sam Holmes)

(Reuters) – Thermo Fisher Scientific Inc said on Monday it would buy Binding Site Group from European private equity firm Nordic Capital in an all-cash transaction valued at 2.25 billion pounds ($2.6 billion), boosting its specialty diagnostics business.

Birmingham, U.K.-based Binding Site’s test helps detect and monitor multiple myeloma, a cancer in a type of white blood cell, and is on track to deliver more than $220 million of revenue in 2022, Thermo Fisher said.

Scientific instruments maker Thermo Fisher’s specialty diagnostics portfolio includes equipment for testing allergy and autoimmune diseases and for monitoring transplant-related biomarkers.

Speciality diagnostics business generated revenue of $3.65 billion for the nine months ended Oct. 1, accounting for about 10% of Thermo Fisher’s total revenue during the period.

U.S.-based Thermo Fisher expects the transaction to be completed in the first half of 2023 and boost adjusted earnings per share by 7 cents on the first full-year of ownership.

Thermo Fisher had earlier this year bought recombinant proteins maker PeproTech for about $1.85 billion in cash, after spending about $17.4 billion to buy clinical research services provider PPD last year.

(Reporting by Leroy Leo and Pratik Jain in Bengaluru; Editing by Sriraj Kalluvila)