Bottom line: Ant Financial will counter bid for MoneyGram, following a surprise rival bid for the company, while Alibaba Pictures’ absorption of the former Youku Tudou looks like a logical consolidation of Alibaba’s filmed entertainment assets.
Ant’s MoneyGram offer attracts rival bidder
Two of Alibaba(NYSE: BABA) founder Jack Ma’s biggest endeavors outside his core e-commerce business are in the headlines, led by a counter bid for a US financial services company his Ant Financial is trying to acquire. That particular deal has a US company called Euronet Worldwide announcing a bid for MoneyGram that’s 15 percent higher than Ant’s own $880 million bid made back in January. The other news is slightly more mundane but still significant, and has Ma’s Alibaba moving its Youku Tudou online video service into its separately listed Alibaba Pictures (HKEx: 1060) filmed entertainment unit. Read Full Post…
Bottom line: This year is likely to see at least a half dozen privately owned financial services companies make public listings in the U.S., Hong Kong and China, with Lakala and Lufax likely to be among the first.
Lakala files for ChiNext IPO
We’re already three months into the new year, and still awaiting the first of what looks set to be a bumper crop of IPOs by a new generation of privately owned financial services firms that are far more dynamic than their state-run peers. Two more of those are in the headlines today, led by China Rapid Finance, a peer-to-peer (P2P) lender that says it’s eyeing a $100 million IPO in New York. At the same time, the popular Lakala electronic payments service has filed to make a listing on the Nasdaq-style ChiNext board in Shenzhen.
That pair are joining a few other notable names that are reportedly aiming to list in the not-too-distant future. That group includes Lufax, which bills itself as China’s largest P2P lender and is aiming to list in Hong Kong. Then there’s Qudian, a microlender that is looking to raise hundreds of millions of dollars with a New York listing. And of course, the granddaddy of them all is Ant Financial, which could raise more than $1 billion with a listing in Hong Kong or dual listing in Hong Kong and China. Read Full Post…
Bottom line: IDG Capital is likely to buy out the venture funding business of US affiliate IDG in the next year, setting the stage for the emergence of China’s first global venture capital firm.
IDG Capital roars with purchase of US parent
A sort of “mouse that roared” story is in the headlines today, with word that US tech finance and information giant International Data Group (IDG) has been bought out by its China affiliate. The China affiliate, IDG Capital, is actually teaming up with another major local partner, China Oceanwide Holdings, to purchase Boston-based IDG, whose assets include the well-respected market research firm International Data Corp (IDC), as well as PCWorld Magazine. Read Full Post…
Bottom line: Starbucks’ selection of WeChat before Alipay for in-store electronic payments is a symbolic victory for the former, while Alipay’s aggressive global expansion could eventually help it to overtake UnionPay outside China.
WeChat ties with Starbucks
China’s two leading mobile payments services are both in the headlines, led by word of a major new tie-up between Tencent’s (HKEx: 700) WeChat and coffee lifestyle titan Starbucks (NYSE: SBUX). I have to admit that my interest in this particular tie-up is somewhat personal, as I’m a big fan of both of these companies and have been waiting a long time for such a partnership.
But equally significant is the fact that Starbucks chose WeChat before archrival Alipay. That same Alipay is in a couple of its own headlines, both showing how it’s trying to expand abroad to compete with China’s other major electronic payments system, the state-owned UnionPay. One of those headlines has Alipay in a new tie-up in Australia, while the other has it announcing partnerships with four major financial companies to expand its footprint in Europe. Read Full Post…
Bottom line: A Chinese bid for the Chicago Stock Exchange could get vetoed on concerns about exposure to the US financial system, while a similar bid for chip maker Lattice could get approved due to its relatively small size.
Lattice buyer has Beijing backing
Two cross-border deals involving China M&A in the US appear to be stalling, even before the protectionist-minded Donald Trump becomes the next US president. That certainly doesn’t bode well for either deal, one in the high-tech chip space and the other in the financial sector, since both could easily have Chinese government backing. One of those has a Sichuan-based investor group trying to buy the tiny Chicago Stock Exchange, while the other has a different group trying to buy mid-sized chip design house Lattice Semiconductor (Nasdaq: LSCC). Read Full Post…
Bottom line: Microlender Qudian could raise $500 million or more in an IPO in the first half of next year, most likely in New York, and could get a modestly positive reception as one of the first in a new wave of private Chinese financial firms to list overseas.
Qudian hires CFO, investment bank
Growing signals are emerging that an offshore IPO could be coming soon for Qudian, a financial firm that began its life as a microlender named Qufenqi helping college students to buy things like computers and smartphones. That’s my assessment after learning from one of my sources that Qudian has hired a foreign-trained CFO and also an investment bank, typical developments for a company that wants to make an offshore listing within the next year and often even sooner.
From an investor’s perspective, the company would offer an interesting private play into China’s financial sector, albeit a relatively niche part of that sector. Investors can already buy into numerous Chinese banks and other financial institutions like brokerages and asset managers. But most of those are state-owned and make many of their decisions based on government directives, with the result that their decisions often have a heavy political element that doesn’t always make commercial sense. Read Full Post…
Bottom line: NetEase could abandon a newly announced New York IPO plan for its media arm if it can find a suitable buyer, while a previously announced New York listing plan by ZTO Express could be revived before year-end.
NetEase news unit makes filing for NY IPO
What’s shaping up as a quiet year for Chinese IPOs in New York has just gotten a small boost, with word that online gaming giant NetEase (NYSE: NTES) has made an initial filing to list its respected but financially-challenged news portal business. Meantime, rumors are building for what’s likely to be one of next year’s biggest offerings from Ant Financial, the financial services affiliate of e-commerce giant Alibaba(NYSE: BABA) and owner of the Alipay e-payments service. But in this case, Ant is shooting down the latest buzz that specific plans are in place for a Hong Kong IPO next year. Read Full Post…
Bottom line: Yum China’s new stock will post moderate gains of 3-6 percent when trading begins on November 1, while Merchants Securities’ IPO shares will price in the middle of their range and debut flat to up slightly.
Merchants Securities makes HK listing
IPOs are heating up as we head into the fourth quarter of 2016 and companies race to complete offerings before the traditionally slow period between Christmas and Chinese New Year. The last week alone has seen progress on what could be the world’s 2 biggest offerings this year, being made by Postal Savings Bank of China and P2P lender Lufax. (previous post) Now 2 more mega listings are in the headlines, as brokerage Merchants Securities prepares for an IPO in Hong Kong and KFC parent Yum (NYSE: YUM) gets set to spin off and separately list its China unit in New York. Read Full Post…
Bottom line: Lufax’s Hong Kong IPO could launch by the end of this year and will get a strong reception, while Xinhuanet’s Shanghai IPO will get a similarly positive reception due to strong support from state-run investors.
Xinhuanet approved for Shanghai IPO
Just days after the stodgy Postal Savings Bank of China launched an IPO that will be the world’s biggest in 2 years, the much higher-tech P2P lender Lufax has kicked off another Hong Kong listing that’s nearly as large. More specifically, Shanghai-based Lufax has begun hiring investment banks for a listing that could raise up to $5 billion, according to new reports.
Meantime, a flurry of new domestic Chinese IPO plans is also in the headlines, led by word that state-owned online news giant Xinhuanet has been approved for a new listing in Shanghai. China stock watchers might recall that Xinhuanet’s IPO plan first surfaced in the headlines 3 years ago, but was indefinitely shelved due to repeated slowdowns and freezes for new domestic offerings due to market volatility. Read Full Post…
Bottom line: Postal Savings Bank’s IPO is likely to price weakly and make a flat trading debut due to waning enthusiasm, while Anbang could make a similarly large IPO next year that will get an equally tepid reception.
Anbang eyes HK IPO
The world’s biggest IPO in 2 years is quickly running out of steam, with word that a Hong Kong listing by Postal Savings Bank of China, the nation’s last national bank to list, is set to price near the bottom of its range. Meantime, what could easily become one of next year’s biggest offering has just popped into the headlines, as insurance giant Anbang is saying in one of its first-ever foreign media interviews that it wants to make its own listing, also in Hong Kong. Read Full Post…
Bottom line: A new global tie-up between UnionPay and PayPal could auger another alliance by the end of the year that would allow the US company to launch a domestic electronic payments service in China by the end of this year.
PayPal in tie-up with UnionPay
In what must certainly be one of the slowest marches to China of all time, US electronic payments giant PayPal (Nasdaq: PYPL) has just formed a tie-up with UnionPay, operator of China’s largest electronic transactions settlement network. On reading the headline I thought that PayPal had finally cracked the market for domestic transactions in China, following more than a decade of trying to enter the lucrative business. But it turns out the new tie-up only covers cross-border transactions and is mostly for UnionPay’s benefit, meaning PayPal is still being locked out of the domestic China market. Read Full Post…
