Sunday ScariesSeptember 6, 2026

Vol. 18 · Week of September 6, 2026

Sunday Scaries Vol. 18

Friday's jobs print moved a September hike to 60%. Nvidia paid $13 billion for Hugging Face, Aon's $17 billion USI deal handed KKR a 6x, and Evercore's 2028 application opens Tuesday.

Friday's jobs print moved a September hike from a coin flip to 60%. Nvidia paid $13 billion for Hugging Face, and two insurance brokers changed hands for $19 billion between them. Sophomores: Evercore's 2028 application opens Tuesday. Ammo for Monday.

Top Stories of the Week

1. Friday's jobs print moved a September hike to 60%, and the two-year hit its highest since January 2025.

The economy added 162,000 jobs in August against the 53,000 economists polled by Dow Jones expected, and unemployment held at 4.1% even though 683,000 people joined the labor force. July was revised from a loss of 23,000 to a gain of 21,000, and wages grew 3.1% on the year, the slowest since May 2021. Markets read it as a hike. CME FedWatch put a September move at about 60% by Friday's close, from roughly even money the day before. The two-year rose to 4.38%, its highest since January 2025, and the ten-year finished at 4.78%. The Dow fell 272 points and the S&P 500 lost 0.38% to 7,718.60, still seven points above where it started the week. Last issue Warsh gave you the argument for a hike and would not say the word. This week the data said it for him.

Why you care: CPI lands next week and the Fed meets on September 16 with a fresh dot plot. The rates view you rehearsed in August needs the new numbers in it.

Interview angle: "The August print took the labor-market excuse off the table. Payrolls tripled the consensus, participation rose and unemployment still held at 4.1%, so the Fed can hike into a market that is absorbing new workers while 54% of the PCE basket runs above 3%. In a model I widen the rate sensitivity and show what 50 basis points more on the term loan does to the IRR."

2. Nvidia is paying $13 billion for Hugging Face, and a billion of it is not purchase price.

Nvidia signed on Wednesday and announced Thursday: about $11.9 billion to Hugging Face stockholders plus an equity retention program of up to $1 billion for employees who come across, so the $12.9 billion headline and the price the sellers get are two different numbers. It is Nvidia's second-largest deal after the roughly $20 billion it paid for Groq's technology and team last December, and it buys the platform where more than 3 million open models live. The seller ran this. Hugging Face turned down a $500 million Nvidia offer at a $7 billion valuation last year, then CEO Clément Delangue went to Jensen Huang himself over the summer, he told CNBC, with a bank fielding other bidders. Nvidia committed to keep the platform open with no requirement to use its chips. Close is expected in the first half of 2027 pending regulators. No advisors were named.

Why you care: TMT groups will pitch off this for months. A strategic bought distribution rather than revenue, and the target picked its buyer and still ran a competitive process.

Interview angle: "Separate the retention pool from the price. The $11.9 billion is what shareholders receive. The $1 billion is equity that vests only if people stay, so it is compensation expense to Nvidia over time and not consideration, and a seller's banker would quote the lower number. The logic is distribution: owning the place developers pick a model from is worth more to a chip company than Hugging Face's undisclosed revenue."

Deals of the Week

Aon is paying $17 billion in cash for USI, and KKR is calling it a 6x. Announced Monday. Aon buys USI Insurance Services, the tenth-largest US broker, from KKR for $17.0 billion, or $16.7 billion net of roughly $278 million in tax attributes. Aon calls the net price 14.5x trailing adjusted EBITDA with synergies included, is underwriting about $395 million of run-rate EBITDA from revenue and cost synergies, and expects adjusted EPS accretion from 2028, all of it debt funded. KKR says the exit is roughly 6.0x the equity it invested in 2017 and 3.4x all the balance-sheet capital it put in over the life of the deal. Close expected in Q4.

Buy-side (Aon): BofA Securities, Citi (financial); Cravath, Swaine & Moore (legal); McDermott Will & Schulte (regulatory); Skadden (financing)
Sell-side (KKR, USI): Goldman Sachs, Morgan Stanley, Insurance Advisory Partners (financial); Simpson Thacher & Bartlett (legal)

EQT is buying McGill and Partners from Warburg Pincus for $2 billion. Same vertical, four days later. Announced Friday. EQT X takes a majority stake in the London specialty and reinsurance broker that Warburg backed at its founding in May 2019, now past $250 million of revenue with 600 people in seven countries. Warburg sells its whole position and the founders and staff roll into a new equity plan. Close in the first half of 2027.

Buy-side (EQT): Ardea Partners (exclusive financial); Clifford Chance (legal)
Sell-side (McGill and Partners): Evercore, Perella Weinberg (financial); Freshfields (legal); Unity Advisory

Lilly is paying up to $2.875 billion for Merida Biosciences, its 13th deal of the year. Announced Monday. All cash, split between an upfront payment and milestones Lilly did not size. Merida's lead program, MER511, is in Phase 1 for Graves' disease and thyroid eye disease. Close in Q4.

Buy-side (Lilly): Ropes & Gray (legal); no bank named
Sell-side (Merida): Centerview Partners (financial); Goodwin Procter (legal)

Pro tip: Two return numbers on one exit. KKR's 6.0x is measured on the equity check it wrote in 2017. The 3.4x is on every dollar of balance-sheet capital over the life of the position, and KKR kept adding in 2020, 2023 and 2025 at higher marks, so the later dollars had a higher entry and less time to compound. Ask which dollars a MOIC is measured on. Same with the multiple: 14.5x is on the net price and on EBITDA with the synergies in it, which backs into about $1.15 billion of synergized EBITDA. Strip out the $395 million, assuming all of it sits in that denominator, and the price is about 22x what USI earns today. Buyers pick the framing.

Recruiting Pulse

Evercore's 2028 application opens Tuesday, four months earlier than last year. Evercore opens its Summer Analyst application for summer 2028 on September 8 and closes it November 15, per the firm's own campus listings. The last two cycles both opened January 1, so the whole window moved from sophomore spring to sophomore fall, and Evercore is the only major bank with 2028 applications open at all. Review is rolling: last cycle superdays were running about two weeks after the open, well before the deadline closed. If you are a sophomore in the class of 2029, the seats go in September, not November. We have the full timeline on the blog.

Return offers landed. If yours did not, the full-time window is open and short. Summer programs at the bulge brackets and elite boutiques wrapped this week, and the people we talk to say some desks handed out fewer offers than last year. Banks fill the gaps in September, off referrals, before a posting goes up. Pick three firms you did not intern at, find one person in the group, and send the note this week.

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