The end has finally come for group buying site LaShou, though this former Internet superstar survived for far longer than I ever imagined it would before its newly announced acquisition by conglomerate SanPower Group, which owns a number of online and offline retail brands. Of course this acquisition doesn’t mean the actual death of LaShou, and it’s quite possible the company could still make a comeback under its new ownership. But its acquisition marks one of the final big consolidation moves for a group buying sector that saw explosive growth 3 years ago, followed by a major correction that saw most companies either close or get acquired. Read Full Post…
US-listed Chinese companies were in the spotlight last week, after a new congressional report detailed the risks they pose to investors due to the unique structure they use to qualify for trading in New York. Uncertainties created by the variable interest entity (VIE) structure are just the latest in a long list of unusual risks that highlight why Chinese firms are quite different from other companies that trade in New York.
But while their risks may be different and often bigger, the rewards of investing in some of China’s biggest corporate names are also potentially huge, as evidenced by exponential growth for shares of some names. Read Full Post…
I’ll be a bit whimsical on this final day of the week with a prediction that a sale could be looming for social networking (SNS) site Kaixin, following reports of strong growth for the company’s online gaming business. Anyone reading this is probably puzzled, unsure about the relationship between a growing gaming business and a company getting acquired. I’ll explain all that shortly, but will end the suspense now by saying the potential buyer would be Internet titan Tencent (HKEx: 700), which shares a number of links and other key qualities with the much smaller Kaixin. Read Full Post…
Many smaller Chinese companies may be getting little or no respect from Wall Street these days, but private equity seems a bit more interested in these undervalued firms. That’s my latest assessment following word that a bidding war has broken out for Chindex (Nasdaq: CNDX), an operator of clinics in China. Chindex said it received a sweetened buyout offer from a managed-led group that first bid for the company in February, after a rival bidder stepped in. This kind of bidding war has been relatively rare in the recent flurry of privatizations by Chinese firms, though this particular case hints that we could see 1 or 2 more similar wars occur as the trend plays out. Read Full Post…
Solar panel maker Yingli (NYSE: YGE) and social networking site Renren (NYSE: RENN) don’t normally have too much in common, other than the fact that both are based in China and come from the tech sector. But on this particular day, both are joined by the unflattering fact that their latest earnings reveal companies deeply mired in the red, sparking sharp drops in their share prices. Yingli’s situation certainly isn’t encouraging, though its issues look more temporary. Renren is a different story, and its latest numbers show the company won’t be able to survive on its own over the longer term and it would be well advised to start looking for a strategic partner. Read Full Post…
The latest earnings season for US-listed Chinese Internet firms has begun with a big yawn, hinting at a looming wave of investor fatigue after a surge in positive sentiment at the end of 2013. I’ve been writing about these companies for quite a while now, and can truthfully say it’s quite common to see their stocks rise or fall by 3 percent or more after they announce their quarterly results. It’s much rarer for shares to remain unchanged after such announcements, though that’s largely what has happened after web portal Sohu (Nasdaq: SOHU) and online real estate services firm Soufun (NYSE: SFUN) kicked off the latest earnings season with release of their fourth-quarter results. Read Full Post…
A couple of Internet M&A deals are in the news as we head into the final days before the Lunar New Year, with word that leading search engine Baidu (Nasdaq: BIDU) has purchased more of group buying site Nuomi, while top Internet company Tencent (HKEx: 700) may be eying restaurant ratings site Dianping. The first deal could reflect a new pattern for Baidu, which has mostly bought controlling stakes but made few outright acquisitions in its recent spree of major purchases. Meantime, the latter deal would look good for Tencent if it was really happening, though I have major doubts about whether it is. Read Full Post…
The following press releases and media reports about Chinese companies were carried on January 25-27. To view a full article or story, click on the link next to the headline.
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Renren (NYSE: RENN) Sells Remaining Stake In Nuomi to Baidu (Nasdaq: BIDU) (PRNewswire)
New data is highlighting an online trend that I wrote about last year, namely that microblogs have peaked in popularity and are starting to decline, in a bad sign for leading web portal Sina (Nasdaq: SINA) as it rushes monetize and list its popular Weibo service. Frankly speaking, I’m not too optimistic anymore about the prospects for Sina Weibo, which is really just a copy of US social media pioneer Twitter (NYSE: TWTR) and hasn’t shown much ability to innovate in the rapidly changing social networking (SNS) space. All that said, I imagine this latest report from the China Internet Network Information Center (CNNIC) is prompting new urgency for Sina to separately list its Weibo unit, and that such an IPO could come later this year. Read Full Post…
Baidu reportedly near deal to buy Zongheng literature site
Internet stalwarts Baidu (Nasdaq: BIDU) and Sohu (Nasdaq: SOHU) are back in the M&A headlines with news of relatively small acquisitions, indicating the market may be running out of big targets as we prepare to end a landmark year for major deals in China. I’ve been reporting on Chinese Internet companies for more than a decade, and during most of that time would be lucky to see 1 or 2 major acquisitions or equity tie-ups in any single year. But all that changed this year, with top Internet names like Baidu, Alibaba and Tencent (HKEx: 700) emerging as major buyers in a series of deals collectively valued at billions of dollars. Read Full Post…
Two of China’s oldest listed Internet firms are in the headlines these last few days, led by word that leading portal Sina (Nasdaq: SINA) has become the late web giant to make a mega bond offering as it eyes potential acquisitions. In the other more amusing news, NetEase (Nasdaq: NTES) is reportedly struggling to build up its pig-raising business that it hyped a couple of years ago, spotlighting its inability to expand beyond its core online game business. Read Full Post…
