Bottom line: China’s anti-trust regulator’s assertion that the Didi-Uber China mega-merger will require its approval could mark the beginning of a new, tougher stance towards the nation’s rapidly consolidating Internet sector.
Anti-trust regulator steps into Didi-Uber marriage
After years of sitting by and doing almost nothing to stop the formation of near monopolies in a number of emerging high-tech sectors, China’s anti-trust regulator may finally be taking notice of rapid consolidation happening in the country’s cyber realm. I’ve frequently complained that China’s commerce ministry has taken a relatively tough position on cross-border M&A for anti-competitive reviews, but pays little or no attention to similar domestic deals that could have similar effects for local consumers. But perhaps that may finally be changing, with word that the Ministry of Commerce is saying its blessing will be necessary for the newly announced mega-marriage between private car services giants Didi Chuxing and the China unit of global leader Uber. Read Full Post…
Bottom line: Baidu and Tencent’s new co-investment in Bitauto’s Yixin could be followed by other similar tie-ups between the pair for assets in their non-core areas if they work well together.
Tencent, Baidu co-invest in Bitauto’s Yixin
The past week has been a turbulent time for China’s “Big 3” Internet companies, which have been thrown into uneasy partnership with the surprise mega merger between hired car services leaders Didi Chuxing and Uber’s China operations. Now a new wrinkle has emerged in an unusual story that made headlines in June, when 2 of the Big 3, Baidu (Nasdaq: BIDU) and Tencent (HKEx: 700), jointly invested in Bitauto (NYSE: BITA), a provider of car-related online services. The latest development is seeing Baidu and Tencent co-invest again in a car financing venture backed by Bitauto. Read Full Post…
Bottom line: Qihoo’s reorganization is part of its hurried bid to re-list in China to pay off backers of its privatization, while shareholders of Trina and Dangdang are likely to approve final management-led buyout offers for the 2 companies.
Qihoo rejigs in hopes of re-listing
The homeward migration of US-listed Chinese companies is in a trio of new headlines, showing that financiers are still willing to back de-listings for stronger companies. The largest of the headlines has security software specialist Qihoo 360 undergoing a major overhaul as it seeks to re-list in China, following its record-breaking privatization from New York last month. Meantime, solar panel maker Trina (NYSE: TSL) and e-commerce site Dangdang (NYSE: DANG) have also announced major advances in their own plans to privatize. Read Full Post…
Bottom line: Didi Chuxing’s new marriage with Uber China could quickly come under stress due to rivalries between the pair outside China, and might force them to forge a broader global alliance.
Didi, Uber set to clash outside China
A couple of new reports are spotlighting how the new mega-merger between Didi Chuxing and Uber’s China unit is creating uncertainty for existing global alliances involving the 2 former bitter rivals. The larger of the headlines has Uber’s US rival Lyft suddenly questioning its alliance with Didi less than a year after the pair formed the tie-up. The other has Didi helping to raise money for Grab, also known as GrabTaxi, a bitter rival of Uber that operates service in 30 cities within 6 Southeast Asian countries. Read Full Post…
Bottom line: Reports that Tencent and Baidu have withdrawn from Wanda’s O2O e-commerce venture are probably true, and the service may be quietly retired over the next 12 month due to lack of progress.
Baidu, Tencent dump Wanda’s ffan.com
Real estate giant Wanda Group may be zipping ahead with its diversification drive into entertainment, but its lower profile move into Internet services doesn’t seem to be gaining nearly as much traction. That’s my latest assessment, following new reports saying Internet giants Baidu (Nasdaq: BIDU) and Tencent (HKEx: 700) have quietly pulled out of Wanda’s high-profile foray into e-commerce announced more than a year ago. The reports are based on market talk citing some business filings that indirectly hint at such a withdrawal, which wouldn’t be too surprising. Read Full Post…
Bottom line: Didi’s merger with Uber China was driven by investor pressure to end their fierce price wars, and the newly combined company is likely to quickly reduce its subsidies and become profitable by year-end.
Didi Chuxing merges with Uber China
Just a week after reports emerged of a truce in the nonstop price wars between private car specialists Didi Chuxing and Uber China, the pair have suddenly announced a merger that will become the latest marriage of former bitter rivals in China. This latest shotgun union, which will put Didi Chuxing in the driver’s seat of the newly combined company, testifies to growing investor impatience at fierce price wars and resulting heavy losses that have become the norm in many emerging Chinese high-tech industries. Read Full Post…
Bottom line: Xiaomi’s new move into notebook PCs looks like a necessary step toward its goal of creating an ecosystem of entertainment products and services, but is likely to suffer from weak reviews and stiff competition from established brands.
Xiaomi rolls out notebook PCs
I really want to write something positive about fading smartphone maker Xiaomi these days, but the company really isn’t giving us much suitable material with its steady string of new but uninspired products. The latest of those is a couple of new notebook PC models, marking its move into a crowded area where it will face stiff competition from established players like Apple (Nasdaq: AAPL) and Lenovo (HKEx: 992), as well as new entrant Huawei.
One could argue that while Xiaomi is coming late to the notebook PC game, such a move is still necessary since such computers will be a critical component to the company’s dream of building an ecosystem of products and services around a range of interfaces like PCs, smartphones and TVs. And Xiaomi is still ahead of the more upward trending LeEco (Shenzhen: 300104), which likes the ecosystem idea so much that it actually changed its former name from LeTV to include this recent industry buzzword. Read Full Post…
Bottom line: Alibaba’s bid for Polish C2C site Allegro looks like a smart move into a related developing market, but could be thwarted by rival Tencent, while affiliate Ant Financial’s new Taiwan insurance tie-up also looks smart though relatively small.
Alibaba bids for Poland’s Allegro
E-commerce giant Alibaba (NYSE: BABA) and its Ant Financial affiliate are in a couple of major headlines as the weekend approaches, each focusing on a strategic growth area. In the first case, Alibaba has entered the bidding for a leading Eastern Europe online auctions site, competing with global rival eBay (Nasdaq: EBAY) for Poland’s Allegro. The second deal has Ant, owner of leading electronic payments service Alipay, expanding its financial services holdings with the purchase of a majority stake in the insurance unit of Taiwan’s Cathay Financial (Taipei: 2882). Read Full Post…
Bottom line: LeEco’s latest mega purchase will throw a lifeline to the struggling Vizio TV brand, as its latest issue of new shares at a big discount reflects growing investor fatigue and skepticism with the company.
LeEco throws lifeline to Vizio
Acquisitive online video superstar LeEco(Shenzhen: 300104) is back in the headlines for its latest mega-purchase, signing a deal to buy Vizio, a US-based TV brand that is at once one of the nation’s largest and also most obscure. At the same time, LeEco, formerly known as LeTV, is in separate but somewhat related headlines in a big cash-raising exercise through a new share issue. The company has become quite adept at such cash raising these days, often using its overvalued stock to bring in new money. Read Full Post…
Bottom line: The appearance of JD.com as China’s first Internet company in the Fortune 500 and exclusion of the nation’s 3 biggest players underscores major shortcomings of the list due to its reliance on revenue as the basis for its rankings.
JD.com lands in Fortune 500
Everyone is buzzing these last few days about the latest edition of the Fortune 500, including the rising presence of China on the list of the world’s largest companies by revenue. But as a China tech watcher, the fact that most caught my attention was the absence of China’s top 3 Internet companies from the list, namely Tencent(HKEx: 700), Alibaba (NYSE: BABA) and Baidu (Nasdaq: BIDU). Adding to the puzzle was the appearance of Alibaba’s much smaller e-commerce rival JD.com (Nasdaq: JD), which became the first Chinese Internet company to make the Fortune 500 list. Read Full Post…
Bottom line: Baidu could get a new higher offer for iQiyi later this year after a former deal collapsed due to undervaluation, while a new Chinese group led by deal maker Sonny Wu is likely to buy a majority stake of AC Milan later this year.
Baidu’s iQiyi sale collapses
Online search leader Baidu(Nasdaq: BIDU) is in a couple of major headlines, each marking a setback in the company’s aspirations to diversify into entertainment. In the larger item, Baidu’s previously announced sale of its iQiyi online video unit has collapsed, after a minority investor complained the sale price was too low. The second headline has Baidu chief Robin Li’s name suddenly disappearing as leader of a group trying to buy European soccer club AC Milan, with reports that another major Chinese deal maker has emerged as head of the group. Read Full Post…
