The following press releases and media reports about Chinese companies were carried on January 14. To view a full article or story, click on the link next to the headline.
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User Sues Xiaomi In Shanghai For Making False Claims (Chinese article)
Huawei Revenue Increases 20 Pct on Sales of Higher-End Smartphones (English article)
The following press releases and media reports about Chinese companies were carried on January 13. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) To Invest Over $500 Mln In Indian Startup (English article)
Facebook (Nasdaq: FB) Discussed Possible Investment In Xiaomi – Sources (English article)
Sinopec (HKEx: 386) Plans To List Retail Unit In Hong Kong – Report (English article)
China’s Wanda Cinema Seeks To Raise $203 Mln In Scaled-Back IPO: Sources (English article)
China Domestic Market Cellphone Output Drops 21.9 Pct in 2014 (Chinese article)
Bottom line: Unbecoming behavior by people like Alibaba’s Jack Ma and JD.com’s Richard Liu reflect poorly on China’s corporate sector, and reflects a lack of professional standards.
Alibaba’s Ma, JD’s Liu on bad behavior
Alibaba’s (NYSE: BABA) charismatic founder Jack Ma is known for speaking his mind, but he was on the defensive last week after inflammatory remarks he made about rival JD.com (Nasdaq: JD) were published in a book. JD.com graciously accepted Ma’s rare apology for the remarks, even as its founder Richard Liu was also in the Internet gossip columns for his own controversial behavior related to a rumored break-up with his longtime young girlfriend. Read Full Post…
Bottom line: Alibaba’s new forays into India and South Korea look like good choices for its first major drive into foreign markets, as such markets are more similar to and have stronger links with China.
Alibaba eyes India investment
It’s been interesting to watch where China’s top Internet firms are placing their bets as they embark on an international expansion to show the world they can compete outside their home market. India is emerging as one destination of choice, with word that e-commerce leader Alibaba (NYSE: BABA) is following smartphone sensation Xiaomi into the market with a major new acquisition target. At the same time, other media reports are saying that Alibaba is also in talks for another major investment in South Korea. Read Full Post…
Bottom line: The sale of a major stake in Bitauto reflects a growing alliance between buyers Tencent and JD.com, and could be followed by a similar sale of a stake in Bitauto rival Autohome.
JD, Tencent buy into Bitauto
A newly announced deal that will see Internet giants Tencent (HKEx: 700) and JD.com (Nasdaq: JD) buy nearly a third of online auto specialist Bitauto (NYSE: BITA) is filled with intriguing implications for China’s consolidating online sector. The deal further cements a growing alliance between Tencent, China’s largest social networking (SNS) operator, and JD, the second largest e-commerce firm. At the same time, the tie-up with Bitauto has fueled speculation that the country’s other major listed online car specialist, Autohome (NYSE: ATHM), could become an acquisition target by one of China’s other leading Internet firms. Read Full Post…
The following press releases and media reports about Chinese companies were carried on January 10-12. To view a full article or story, click on the link next to the headline.
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Bottom line: Ctrip’s latest M&A reflects the growing scarcity of good acquisition targets for cash-rich Chinese Internet firms, which could pressure them to issue dividends or launch share buy-backs.
Ctrip makes UK acquisition
A new overseas purchase by leading online travel agent Ctrip (Nasdaq: CTRP) is drawing yawns from investors, reflecting the very real fact that Chinese Internet firms have far too much cash in their coffers and no place to spend it. This particular dilemma is one that most western companies would love to have, since excess cash can be used for not only M&A and organic expansion, but also to pay dividends or buy back shares. But in the case of Chinese companies, a big chunk of the cash has been raised in a series of massive bond and share offerings over the last 2 years, meaning it would be strange to turn around and return the money to investors through a dividend or share repurchase. Read Full Post…
Bottom line: Wanda’s new e-commerce initiative looks overvalued following a recent investment, but could have the resources and expertise it needs to pose a serious challenge to Alibaba and JD.com.
Wanda raises money for e-commerce JV
Fresh from the successful listing of its core real estate arm, Wanda Group is pushing full-steam ahead into another major new initiative in e-commerce, aiming to challenge industry leaders Alibaba (NYSE: BABA) and JD.com (Nasdaq: JD). Wanda’s colorful and very wealthy founder Wang Jianlin was busy talking up his e-commerce initiative this week, announcing a major new funding and important new partner for the project. Wang has forged ahead in several new areas over the past year, including hotels, theme parks and movie theaters, as he attempts to build up an entertainment empire to rival global names like Disney (NYSE: DIS). Read Full Post…
Bottom line: Tencent’s inclusion in a national credit database initiative reflects the big commercial potential of WeChat, but a lawsuit over rumor spreading also highlights one of WeChat’s biggest liabilities.
Tencent joins credit card database drive
Two stories in the news are showing how WeChat is likely to become the future big bread-winner for Internet giant Tencent (HKEx: 700), even as the wildly popular mobile messaging service poses tricky liability risks for its parent. The first headlines spotlights WeChat’s huge potential, with reports that the central bank has invited Tencent to take part in development of a new national credit database. The latter news isn’t quite so upbeat, with a Shenzhen-listed drugmaker suing Tencent for failing to stop the spread of rumors about its products over WeChat. Read Full Post…
Bottom line: Chinese appliance makers and Internet companies need to focus their smart device efforts on one or two key alliances each, or risk spreading their resources too thin.
Haier in new tie-up with Evergrande
Smart devices look set to become a theme of the New Year, with new reports that domestic appliance giants Haier (HKEx: 1169) and Midea (Shenzhen: 000333) have formed major new tie-ups to develop the space. Similar alliances began accelerating in the second half of last year and are aimed at developing the “Internet of Things”, which envisions an interconnected world where devices and their owners can talk to each other at any time over a wide range of wired and wireless networks. Read Full Post…
Bottom line: Perfect World’s de-listing plan is likely to succeed and could be followed by a merger with Shanda or Giant Interactive, while Renren is likely to also get bought out and de-list by the end of the year.
Perfect World gets buyout offer
Perfect World (Nasdaq: PWRD) has become the latest US-listed online game operator to decide it’s unappreciated by shareholders, announcing a plan to privatize and de-list its shares from New York. The management-led buyout offer shouldn’t come as a surprise, as it follows a steady stream of similar moves that has seen peers like Giant Interactive and Shanda Games (Nasdaq: GAME) also leave or prepare to leave the market.
At the same time, another headline from struggling social networking site (SNS) Renren (NYSE: RENN) is fueling speculation of a similar imminent de-listing. That news has Renren announcing the resignation of its CFO — news which should normally have a neutral to negative effect on the company’s stock. But in this case the stock has jumped on the news, indicating investors may think a buy-out offer is coming. Read Full Post…
