Bottom line: Alibaba’s victory in a shareholder lawsuit is partly justified due to its pre-IPO disclosure that piracy is a major risk for the company, but it still should have disclosed a recent government report sharply criticizing it on the matter.
Alibaba triumphs in shareholder lawsuit
E-commerce giant Alibaba (NYSE: BABA) is a master at influencing public opinion through its own hype, but is far less successful with government officials who often view its aggressive ways with more skepticism. With that background in mind, the company’s new courtroom victory in a shareholder lawsuit looks like a refreshing nod of approval from a government source, setting it apart from the usual cheers from fans of the company’s stock. I would probably agree with that view, even though in this case I’m not sure I completely agree with the judge’s decision. Read Full Post…
The headlines last week were littered with signs of growing unrest and chaos among the dozens of US-listed Chinese companies trying to privatize from New York and return to China in search of higher valuations. One of the biggest items saw signs of a new bidding war break out for private clinic operator iKang (Nasdaq: KANG), while another saw data center operator 21Vianet (Nasdaq: VNET) mount what increasingly looks like a stealth privatization campaign. A third saw social media website operator YY (Nasdaq: YY) become the first to abandon its privatization bid altogether, casting doubt on many of the other similar pending offers that have gone for months without any progress. Read Full Post…
Bottom line: A new IPO from Postal Savings Bank will price and debut strongly thanks to its conservative stance, while another offering from Orient Securities could also do moderately well due to its small size.
Postal Bank set for mega-IPO in HK
Two financial institutions are lining up to launch IPOs in Hong Kong this week, led by what’s likely to be the biggest offering this year by China’s stodgy Postal Savings Bank, whose listing could raise up to $8 billion. In a far smaller deal, brokerage Orient Securities is also set to announce a HK$1.15 billion ($174 million) IPO deal as soon as today, in what looks like a slightly desperate bid for cash following its much larger Shanghai listing last year at the height of China’s stock market boom. Read Full Post…
Bottom line: A new China Life bid for iKang could trump Yunfeng, while 21Vianet could be mounting a stealth privatization bid that would see it slowly sell most of its shares to big buyers before mounting a formal de-listing attempt.
China Life eyeing bid for iKang?
A few strange twists are taking place in the story that has seen some 40 US-listed Chinese companies launch privatization bids since the start of last year, led by the surprise re-heating of a bidding war for private clinic operator iKang (iKang). In a separate headline, data center operator 21Vianet (Nasdaq: VNET) gave a new signal that it will abandon a previous buyout offer and may launch a stealth de-listing bid instead. And in the strangest development, the board of web portal operator Sohu (Nasdaq: SOHU) has rejected an investment plan by the company’s founder that looked like a prelude to a possible buyout offer at the time. Read Full Post…
Bottom line: YY’s abandonment of its privatization plan and concurrent share buyback look like savvy moves to build confidence and attract attention from investors, and could soon be followed by similar withdrawals by other big buyout candidates.
YY abandons privatization
Following a steady stream of signals hinting at new obstacles for US-listed Chinese stocks trying to privatize, social networking site YY (Nasdaq: YY) has become the first to formally abandon its plans to abandon New York. I’ve been predicting that up to half or more of the 40-odd privatization plans announced since the start of last year could ultimately collapse, and have to commend YY for being brave enough to be the first to openly discuss the abandonment of its buyout offer. The original buyout group led by YY’s chairman and CEO could have easily just remained quiet on the subject until everyone assumed the offer was dead. But in this case they’ve taken the more responsible route of admitting to failure. Read Full Post…
Bottom line: A lackluster debut for China Online Education and abrupt end to the bidding war for iKang point to weak investor interest in US-listed Chinese stocks, which is likely to persist through year end.
51Talk operator fizzles in NY trading debut
Chinese IPOs in New York continue to sputter heading into the summer months, with the latest offering by China Online Education Group (NYSE: COE) debuting flat after raising a very modest $46 million. Meantime, one of the most hotly contested privatizations in an exodus of Chinese companies from New York has come to an abrupt and somewhat disappointing end in the case of clinic operator iKang (NYSE: KANG). That development has come with word that 2 groups vying to buy out iKang have suddenly dropped their bids, yielding to a third group associated with e-commerce giant Alibaba (NYSE: BABA). Read Full Post…
Bottom line: Jack Ma’s newly stated preference for an Ant Financial IPO in Hong Kong could touch off a new clash that would challenge the local securities regulator to grant an unusual listing exception or risk losing the blockbuster deal to New York.
Ant Financial eyes HK IPO
Just a couple of years after a high-profile tussle that saw e-commerce giant Alibaba (NYSE: BABA) ditch Hong Kong to make its record-breaking IPO in New York, talkative founder Jack Ma is gearing up for a similar game of chicken for an upcoming IPO by his company’s affiliated Ant Financial unit. That’s my initial assessment, following media reports that Ma has said his first preference would be a Hong Kong IPO for Ant Financial, China’s leading private financial services company whose prize asset is its Alipay electronic payments service. Read Full Post…
Bottom line: A bidding war for iKang could see prices rise above the current highest offer of $25 per ADS, while a buyout bid for TCL Communication will be priced at a slight premium to the current stock price and meet with little resistance.
iKang attracts new buyout offer
The twisted privatization tale of private clinic operator iKang (Nasdaq: KANG) has just taken a new turn, with its receipt of another buyout offer from Yunfeng Capital, the private equity investor with ties to e-commerce giant Alibaba (NYSE: BABA). This development makes Yunfeng the third party to bid for iKang, which has easily become the most contested of some 40 US-listed Chinese companies trying to privatize from New York. Meantime, a far less contested buyout offer has just come in Hong Kong, where faded cellphone maker TCL Communications (HKEx: 2618) has just received a buyout offer from its China-listed parent. Read Full Post…
Bottom line: New sales of Alibaba and Lenovo shares by big stakeholders partly reflect disappointment in each stock’s performance by the seller, as both companies face issues that could stunt their medium-term growth.
Big stakeholders sell Alibaba, Lenovo shares
The folks at e-commerce giant Alibaba (NYSE: BABA) and PC leader Lenovo (HKEx: 992) are licking their wounds today, after each was dumped by a major major shareholder. In the first case longtime backer SoftBank has just sold off a big chunk of its Alibaba holdings, raising a hefty $7.9 billion in the process. The second deal has Internet giant Google (Nasdaq: GOOG) looking to sell about $200 million worth of Lenovo stock. Alibaba and SoftBank are trying to put a positive spin on their development, but the bottom line is that both Alibaba and Lenovo stock have become disappointments recently for all investors. Read Full Post…
Bottom line: Dalian Wanda’s de-listing plan from Hong Kong is likely to succeed, while eLong could re-list in China and become the travel services provider for WeChat following its New York privatization.
Dalian Wanda joins homeward migration
A trio of new headlines are part of the recent homeward migration of offshore-listed Chinese companies, led by a highly anticipated $4.4 billion offer to privatize property giant Dalian Wanda (HKEx: 3699). Also making news is faded online travel agent eLong (Nasdaq: LONG), whose shareholders have just approved a privatization that will soon end its 12-year-old listing in New York. Finally there’s film production house Yongle Film and Television, which would have been a strong New York IPO candidate in a earlier era but is now in the process of making a backdoor listing in Shenzhen. Read Full Post…
Bottom line: BOC Aviation’s stock will debut with a 5-10 percent gain when trading starts on Wednesday, while Lufax’s delay of its IPO plan looks prudent until China’s P2P lending sector settles down.
BOC Aviation set for strong debut
After running into some early minor turbulence, Asia’s second biggest IPO of the year is set to take off later this week in Hong Kong when aircraft leasing company BOC Aviation begins trading in what should be a relatively buoyant debut. But the ride to market is looking a bit rockier for Lufax, with reports that what could become the first IPO for a P2P lender is being delayed until next year. Lufax had earlier signaled it planned to make its listing this year, most likely in Hong Kong or Shanghai. But its plan is being delayed as Beijing moves to clean up the nation’s unruly P2P lending market. Read Full Post…
