Shuanghui’s New Name, Baidu’s New Look
We’re in that brief window of time each year between the western and Chinese new years, so perhaps it’s appropriate that we’re getting reports of new looks at fast-rising food maker Shuanghui International and online search leader Baidu (Nasdaq: BIDU). Shuanghui has just released an announcement saying it will officially change its name to WH Group as part of a new globalization campaign. Meantime, separate media reports are saying that Baidu is experimenting with adjustments to its signature home page, in a revamp that would be its first in 7 years.
There’s nothing really related about these 2 moves besides their newness, since Shuanghui comes from a very traditional industry while Baidu represents a younger generation of fast-growing high-tech firms. But both moves do reflect a certain entrepreneurial spirit at each of these companies, which are following their western peers in realizing they need to constantly reinvent themselves to stay relevant and competitive.
All that said, let’s zoom in on these latest 2 news bits as we head into the Chinese New Year, which formally begins on January 31 with the start of the Year of the Horse. The first bit comes from a formal announcement saying that the Shuanghui name will formally gallop into the sunset in the Chinese New Year, to be replaced by the more international sounding WH Group. (company announcement; Chinese article)
The announcement itself isn’t very interesting, saying that WH is short for Wanzhou Holdings, which translates to “10,000 continents.” That new moniker reflects the company’s global aspirations, which formally began last year with its $4.7 billion purchase of leading US pork products maker Smithfield. (previous post) Since then Shuanghui has also acquired a stake in a Spanish meat processor related to the Smithfield deal, and the company is also reportedly planning a listing in Hong Kong to raise its global profile.
This name change looks connected to all of those moves, and I suspect we could see one or two more big acquisitions by Shuanghui in the year ahead as it digests its Smithfield purchase. More broadly, Shuanghui’s global drive is part of China’s recent decision to support a worldwide expansion by some of its major food makers. Others to announce recent acquisitions and foreign tie-ups include big names like Shanghai’s Bright Food and Mengniu Dairy (HKEx: 2319). I expect we’ll see some integration issues in many of these tie-ups, as Chinese are quite unfamiliar with the sector overseas. But that said, at least most of the purchases we’re seeing involve relatively healthy companies, which should give the mergers a better chance of success.
In the other “new” news, media are saying that Baidu is secretly trialing a new homepage to replace its trademark search site that features a red-and-blue logo of the company’s name in Chinese and English with a bear’s paw print in the center. (Chinese article) I had to look twice at one news article to figure out what was different, since the screen shot of the new layout looks quite similar to the current one. But apparently the new site would be a bit simpler, removing most of the text links that currently surround the page’s central search field.
The fact that reporters were given such detailed access to the plan indicates to me that Baidu wants the story to be leaked so it can gauge some initial reaction to the changes. Personally speaking, I find the changes quite subtle and a little boring, and might have hoped for something more dramatic. But then again, Baidu founder Robin Li is one of China’s richest men thanks to the rapid rise of his company, so it’s probably fair to say that he knows a bit more about making a successful search engine than this humble writer commenting on his company.
Bottom line: Shuanghui’s new name reflects its global aspirations, which are likely to include an IPO and more acquisitions this year, while Baidu’s new look looks subtle and uninspired.
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