The New York Times - USA (2020-08-06)

THURSDAY, AUGUST 6, 2020 B1

KY

TECH ECONOMY MEDIA FINANCE

6 MEDIA

Behind record subscriptions,

quarterly digital revenue at

The New York Times passed

print for the first time.

3 TECHNOLOGY

Facebook unveiled its TikTok

rival, Instagram Reels, which

lets people create and share

15-second videos.

10 SPORTS

How the P.G.A. of America

turned a municipal course

in San Francisco into a site

fit for a major tournament.

The nation’s leading health insur-

ers are experiencing an embar-

rassment of profits.

Some of the largest companies,

including Anthem, Humana and

UnitedHealth Group, are report-

ing second-quarter earnings that

are double what they were a year

ago. And while insurance profits

are capped under the Affordable

Care Act, with the requirement

that consumers should benefit

from such excesses in the form of

rebates, no one should expect an

immediate windfall.

But the amounts that insurers

are retaining have caught the at-

tention of the Trump administra-

tion. The Health and Human Serv-

ices Department advised compa-

nies to consider speeding up re-

bates, and on Tuesday suggested

that they reduce premiums to help

consumers through the economic

downturn caused by the pan-

demic.

Just this Wednesday, CVS

Health, which owns Aetna, the big

insurer, posted much higher earn-

ings. CVS, which also owns a large

Coronavirus

Has Fattened

Insurer Profit

By REED ABELSON

CONTINUED ON PAGE B5

A few weeks ago the American

private equity firm Cerberus Cap-

ital Management seemed to be on

the cusp of provoking a major

shake-up in German banking af-

ter it pressured the two top execu-

tives of the country’s second-larg-

est lender to quit.

But the interloper’s victory did-

n’t last long.

Now the German establishment

is pushing back in a battle for con-

trol that may determine whether

the country’s banks can arrest

their slide into irrelevance.

Cerberus is the largest private-

sector shareholder in Com-

merzbank, Germany’s second-

largest bank. The firm has been

lobbying hard for drastic cost cuts

and other painful changes to re-

verse the bank’s chronically me-

diocre profits.

The need to fix German banks

has become even more urgent af-

ter the pandemic caused a surge

in delinquent loans. On Wednes-

day, Commerzbank reported a

quarterly profit that was above

analysts’ expectations but

warned it would record a loss for

the year.

Cerberus is coexisting uneasily

with Commerzbank’s largest

shareholder, the government,

which has three times as many

The Battle for Control of Commerzbank

A U.S. buyout firm is running into pushback over its moves on Commerzbank.

FELIX SCHMITT FOR THE NEW YORK TIMES

By JACK EWING

CONTINUED ON PAGE B5

TikTok is going to get acquired
or die trying.
The hit video app appears
headed for a shotgun wedding
after President Trump has de-
cided to force its owner, the
Chinese tech conglomerate
ByteDance, to sell TikTok to an

American acquirer or be barred
from operating in the country. On
Monday, the president — acting
as a combination of investment
banker, regulator, and back-room
mafioso — said he would ap-
prove a bid by Microsoft for
TikTok’s operations in the United
States, provided that both parties
meet his as-yet-unspecified
demands and hit a Sept. 15 dead-
line.
There are a million questions
still swirling around a possible

TikTok-Microsoft deal. But the

most glaring question mark is

that nobody I’ve talked to has

figured out exactly what “buying

TikTok” will mean, or whether

what many experts consider

TikTok’s golden goose — the

complex algorithms that make

the app so addictive — would be

included in a deal.

A Microsoft spokesman de-

clined to comment. A TikTok

spokeswoman, Ashley Nash-

Hahn, declined to offer details

about what parts of TikTok’s

technology were and weren’t up

for sale.

“While we do not comment on

rumors or speculation, we are

confident in the long-term suc-

cess of TikTok,” she said in an

emailed statement.

Some corporate acquisitions

are straightforward. In the sim-

plest kind of deal — say, a big

restaurant buying a smaller

restaurant — the acquirer buys

everything on the other compa-

ny’s balance sheet: all its assets

and liabilities, including its

kitchen equipment, its secret

recipes, and any real estate it

owns. Lawyers and bankers try

to place a value on those things,

and estimate the company’s

Sale Could Pivot on Control

Of TikTok’s Talent and Data

CONTINUED ON PAGE B4

Kevin Roose
THE SHIFT

Would an algorithm

based on Americans’

data be as addictive?

As the coronavirus pandemic shuttered

bars and restaurants in March, Phil Mc-

Daniel’s craft distillery in St. Augustine,

Fla., stopped producing bourbon. Then he

realized there was one alcohol-based prod-

uct he could make that people would still

clamor for: hand sanitizer.

His St. Augustine Distillery soon

churned out the first of what became 10,000

gallons of the disinfectant. With sanitizer in

short supply nationwide, he quickly sold

and donated most of the supplies to hospi-

tals and emergency responders along Flor-

ida’s northeastern coast.

“In the beginning, it was just unbeliev-

able, the sort of frenetic demand that was

out there,” Mr. McDaniel, 62, said. “It was

so gratifying to us to be able to come in and

help.”

But as virus cases have spiked again in

Florida and other states, Mr. McDaniel said

he had no plans to make more sanitizer.

That’s because the early demand he experi-

enced tailed off in June when large brands

like Purell were able to pump out more

product. The price for sanitizer, which had

hovered at $50 a gallon, plunged to around

$15 a gallon. Today, he still has about 1,000

gallons of it, spread between 250-gallon

Craft distilleries like Dark Door Spirits in Tampa, Fla., shifted quickly to make hand sanitizer. Matt Allen, above right, the company’s co-owner, has worked to lock in contracts. St. Augustine Distillery, above left, is back to making bourbon.

PHOTOGRAPHS BY EVE EDELHEIT FOR THE NEW YORK TIMES

Spirit for Sanitizer

Ebbs for Distillers

The craft industry met the demand for disinfectants,

but the market has dried up despite spiking virus cases.

CONTINUED ON PAGE B3

By KELLEN BROWNING

ST. AUGUSTINE DISTILLERY