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Interest from Google and others, revenue about $300 million



GitHub has been an acquisition target for years, and repeatedly spurned requests from companies including Microsoft, Google and Amazon, according to people familiar with the matter.

Atlassian, which has headquarters in Australia and the U.S., and China’s Tencent are among other companies that made inquiries in recent years, said one of the people, who asked not to be named because the talks were confidential. Amazon and Atlassian declined comment. Tencent didn’t respond to requests for comment.

“There has been interest in GitHub for a long time,” said Peter Levine, a partner at the venture capital firm Andreessen Horowitz, which first backed GitHub in 2012. “They had lots of options. There’s a real strategic fit at Microsoft.” Levine would not name specific companies who had approached GitHub.

Andreessen invested $100 million into GitHub in 2012, the “largest single check we had ever written,” Levine wrote in a blog post on Monday. A follow-on funding round in 2015, led by Sequoia Capital, valued GitHub at $2 billion.

Nadella won over Wanstrath in the last 24 months with his vision for GitHub fitting within Microsoft, one person close to the deal said. New CEO Nat Friedman, who joined Microsoft through a prior acquisition, plans to run GitHub independently for the time being.

That is similar to how Microsoft kept LinkedIn largely independent — although GitHub will eventually become a part of Microsoft’s growing commercial cloud business alongside products like Office 365 and Dynamics 365, Friedman told CNBC in an interview.

If anything, Microsoft wants GitHub to get even better at being GitHub, Friedman said.

GitHub has had ongoing conversations with Microsoft for several years, so the acquisition didn’t begin with any single event, Wanstrath told CNBC. The companies have a shared mission to help developers be more efficient and more collaborative, he said.

Neither Friedman nor Wanstrath would comment on the acquisition process.

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Dr. Scott Gottlieb warns of ‘staggering’ Covid death totals in U.S.



The United States could see “staggering” numbers of coronavirus deaths in the coming months as infection rates increase during the colder months, Dr. Scott Gottlieb told CNBC’s “Closing Bell” on Friday.

There were 916 deaths from Covid-19 in the U.S. on Friday, according to data compiled by the Covid Tracking Project, an independent volunteer organization launched by journalists at The Atlantic. New coronavirus cases eclipsed 71,600 on Thursday.

Gottlieb, a physician who served as the U.S. Food and Drug Administration commissioner, emphasized that doctors have improved their treatment of Covid-19 patients during the pandemic, bringing down the mortality rate. He has said it might have been reduced by 50%.

Patient care also has been improved due to drugs such as Gilead Sciences‘ remdesivir, which on Thursday became an FDA-approved treatment for Covid-19, as well as the use of steroids such as dexamethasone, according to Gottlieb. President Donald Trump received both after his coronavirus diagnosis.

Despite these positive developments, Gottlieb said the challenge the U.S. is facing now is simply how widespread the virus is across the country. “Mortality is going to be down, but we’re going to be infecting so many people that the daily death statistics are going to be staggering,” said Gottlieb, who led the FDA under Trump from May 2017 to April 2019.

There could be “well above 1,000” new deaths per day reported in the weeks ahead, he said. “And we might retest some of the totals that we saw in the spring, when we were reporting 2,000 deaths a day related to this virus, just because of the sheer number of people we’re likely to infect heading into the winter right now.”

The U.S. has almost 8.5 million confirmed cases of Covid-19 and at least 223,752 people have died, according to data compiled by Johns Hopkins University.

Public health experts have been warning for months that colder weather during the fall and winter is likely to coincide with a resurgence of the coronavirus because people are spending more time indoors, where transmission can more easily occur.

The pandemic is intensifying in countries across the world, and some nations are on a “dangerous track,” the head of the World Health Organization warned Friday. “We are at a critical juncture in this pandemic, particularly in the Northern Hemisphere,” Director-General Tedros Adhanom Ghebreyesus said.

Restrictions have again been implemented in parts of Europe, including an overnight curfew in regions of France, in an attempt to reduce the spread of Covid-19.

Gottlieb said he believes the response in the U.S. to rising infection rates will be targeted interventions in hot-spot areas, rather than the lockdown orders that were issued in the early stages of the pandemic when inadequate testing regimes made it difficult to determine where transmission was happening.

“I think we’re going to bear a lot more infection … and the health-care system is going to have to bear the brunt of this burden, because I don’t think you have the popular will for stay-at-home orders or broad mitigation,” he said.

“If everyone would just wear masks, that would cut down on the spread,” he added.

— CNBC’s Noah Higgins-Dunn contributed to this report.

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PwC’s Tim Ryan on supply chain moves from China under Biden or Trump



Companies plan to continue shifting supply chains out of China, regardless of who wins the Nov. 3 presidential election, according to Tim Ryan, the chair of PwC U.S.

The issue came into focus in response to President Donald Trump‘s trade war with China, but it only gained importance across corporate America due to the coronavirus pandemic, Ryan said in a “Closing Bell” interview, drawing on findings from a recent survey conducted by the powerhouse accounting firm.

“Covid really put a spotlight … on supply chain risk, and one of the things that we’re seeing is supply chain derisking has moved all the way up to the boardroom level, as we see now concentrations in our supply chains that was maybe not evidenced before,” Ryan said.

The beneficiaries of exits from China, home to the world’s second-largest economy, are likely to be countries in Southeast Asia, Mexico and the United States, according to Ryan.

In PwC’s survey of 578 U.S. executives, released last month, there was traction for policies to boost American manufacturing. Approximately 46% of respondents said they “strongly agree” that the government should ramp up U.S. production of essential products to aid the nation’s economy.

The production of medical equipment and pharmaceutical supplies outside the U.S., in particular, has seen renewed scrutiny during the pandemic, as factories across the globe have shuttered and supply shortages have arisen. The combination of the trade war and pandemic showed that retailers also had relied “too much” on production in China, former Macy‘s CEO Terry Lundgren told CNBC earlier this year.

Trump’s trade war with China resulted in each side placing billions of dollars worth of tariffs on the other’s goods and motivated some companies to begin relocating their supply chains elsewhere. Indeed, Trump has repeatedly called on businesses to do just that.

Some efforts to move production to new countries have been inhibited by the global health crisis. That’s the case for the maker of Roomba robot vacuum cleaner, which is shifting production to Malaysia to avoid the tariffs.

“We were hoping to get it done by the end of this year,” iRobot CEO Colin Angle said Wednesday on “Closing Bell.” “Unfortunately, the pandemic has slowed down our ability to move into Malaysia, so that’s going to move into [2021] before we get it done.”

Ryan said PwC’s survey found slightly more executives were worried about trade tensions with China under Trump, compared with under Biden. However, almost 30% of respondents said they “strongly agree” that trade restrictions on China will be intensified no matter who wins.

Biden, the former vice president under President Barack Obama, currently leads Trump by 7.9 percentage points in an average of national polls compiled by RealClearPolitics.

“I see the China-U.S. relationship still being very important. It’s a major market, and so we do see investment there,” said Ryan. “But on a relative basis, we’re seeing U.S. companies planning to spread that out more, and that’s a trend that’s been underway for the last couple years that we expect to continue.”

Another finding from PwC’s survey is that regardless of the election outcome, 70% of business leaders expect corporate taxes to increase to help pay for the trillions of dollars in coronavirus stimulus. Trump’s signature tax law lowered the rate from 35% to 21%. Biden has called for it to be raised to 28%.

“One of the careful things we have to balance here, we clearly have a need to make sure we pay for the stimulus. We clearly have a need to make sure we don’t leave people behind, but in the same token, we can’t lose the competitiveness of U.S. businesses because that does mean jobs,” Ryan said.

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Prepare for more volatility in the Chinese yuan, regulator says



BEIJING — China’s foreign exchange regulator told businesses Friday to prepare for more volatility in the yuan.

The Chinese currency, also known as the renminbi, strengthened roughly 1% this week against the U.S. dollar to levels not seen since July 2018. Less than five months ago, the yuan was at its weakest against the greenback since early 2008. Although that is based on a midpoint set by the central bank, the People’s Bank of China, Beijing has been allowing markets to play a greater role in the exchange rate.

One-year implied volatility of the yuan has climbed to 5%, versus less than 2% for previous years, indicating a basis of “increased flexibility” in the exchange rate, State Administration of Foreign Exchange spokeswoman Wang Chunying told reporters on Friday.

“In face of exchange rate fluctuations, businesses should strengthen their risk prevention awareness,” Wang said, according to a CNBC translation of her Mandarin-language remarks. She said that rather than expect one-way strengthening or weakening of the yuan, businesses should prepare for two-way moves in the exchange rate, and hedge appropriately without speculating.

Chinese yuan daily midpoint fix vs. USD (2008-2020)

Note: Lower figures reflect stronger yuan vs. USD. Source: Wind Information.

On Friday, the official daily midpoint set by the central bank was 6.6703 yuan versus the U.S. dollar, for a gain of more than 4% versus the greenback for the year so far.

The recent strength in the yuan comes as the U.S. dollar index has fallen to its lowest since early September. While the yuan’s exchange rate versus the greenback is closely followed, officials have previously emphasized that the currency’s value is more accurately reflected by a government-run index of the yuan versus a basket of currencies. The index’s latest weekly print from Oct. 16 was the highest since March.

When asked by CNBC last week about the outlook for the Chinese currency, the PBoC monetary policy department head Sun Guofeng said the central bank would maintain a flexible and stable exchange rate.

“The slight appreciation in the yuan’s exchange rate is the natural reflection of the good trajectory of (China’s) economy,” Sun said at a press conference, according to a CNBC translation of his Mandarin-language remarks.

In August 2015, a surprise devaluation in the yuan by more than 4% over five days shocked global markets. The PBoC has been trying to strike a balance between keeping the yuan weak enough so Chinese goods remain attractively priced for overseas buyers, while preventing domestic capital from flowing too quickly out of the country to stronger currencies. Longer-term, Beijing would like the yuan to be used more internationally, versus the roughly 2% of global foreign exchange reserve assets it holds currently.

Analysts expect China’s relatively robust economic growth and market size will attract more foreign capital in coming years.

The International Monetary Fund forecast last week that China’s GDP will grow 1.9% this year as the only major economy to expand in the wake of the coronavirus pandemic. Covid-19 first emerged in the Chinese city of Wuhan late last year, before accelerating its spread in the country, and subsequently overseas.

The IMF predicts the U.S. economy will contract 4.3% this year, with global growth falling by 4.4%.

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