Bottom line: Fosun is prepared to up its latest bid for Club Med by another 20-30 percent, while Anbang needs to be careful in its investments to avoid ending up with a portfolio of overvalued, underperforming assets.
Two of China’s most active institutional investors are in the headlines today, led by a new sweetened bid from private equity giant Fosun International (HKEx: 656) as it competes with an Italian group to buy French vacation resort operator Club Med (Paris: CU). Meantime, another recently acquisitive investor Anbang Insurance is back in the headlines, with word that it’s boosted its stake in Minsheng Bank (HKEx: 1988 Shanghai: 600016), China’s oldest and largest privately owned lender. Continue reading →
Bottom line: Haitong’s new share offer is capitalizing on strong sentiment toward brokerages and could be used to fund an overseas purchase, while Wanda’s theme park foray looks too aggressive and is likely to run into problems.
Big fund-raising is in the headlines today as we head into the end of 2014, with real estate giant Dalian Wanda continuing to talk up its upcoming blockbuster IPO as Haitong Securities (HKEx: 6837; Shanghai: 600837) takes advantage of positive market sentiment to make a major new share float. Both plays come as Hong Kong and the US get set to officially wrap up a banner year for fund raising by Chinese companies, fueled by strong investor sentiment. Everyone is racing to finish their fund raising before December 31, since the first quarter of the year is typically a quiet period for such activity and there’s no guarantee this wave of positive sentiment will last into 2015. Continue reading →
Bottom line: 2015 will see an acceleration in 4G services, with China Telecom and Unicom winning commercial FDD licenses in the first quarter and 2-4 VNO licensees potentially emerging as real rivals to the big 3 telcos.
A number of telecoms stories are in the headlines today, highlighting the huge hopes everyone has for new 4G services that will open up the market to a wide array of new products. Leading the headlines are word that China Telecom (HKEx: 728; NYSE: CHA) and Unicom (HKEx: 763; NYSE: CHU) have gotten the green light to expand their trial 4G networks, as the nation’s 2 smaller mobile carriers play catch-up to industry titan China Mobile (HKEx: 941; NYSE: CHL).
At the same time, another new report is showing the pathetic state of under-utilization for China Mobile’s 3G network, which uses a homegrown technology that has been plagued with problems. Finally there’s a third report saying the telecoms regulator has just issued its fifth and possibly final batch of virtual network operator (VNO) licenses, creating several dozen new carriers that will compete in in 4G by leasing capacity on the networks of the big 3 telcos. Continue reading →
The following press releases and media reports about Chinese companies were carried on December 20-22. To view a full article or story, click on the link next to the headline.
China’s Fosun (HKEx: 656) Raises Offer For Club Med (Paris: CU) (English article)
Bottom line: LeTV’s new tie-up with Microsoft is mostly empty talk that’s unlikely to produce any meaningful results, and is part of a recent campaign to divert attention from problems at the company’s core business.
After several months out of sight while he received medical treatment, the charismatic CEO of online video company LeTV (Shenzhen: 300104) has come roaring back into the spotlight with a series of new initiatives to boost investor confidence and show he still has a long-term vision for his company. The latest of those has LeTV teaming up with software giant Microsoft (Nasdaq: MSFT) in a global alliance to operate what’s being billed as a cloud-based online video service. Continue reading →
Bottom line: Uber will face a difficult time in its global expansion due to poor understanding of local markets and lack of control of its rental fleets.
By Lu Jin
In the last few days, while I was still pondering the big news about a $600 million investment by China’s leading search engine Baidu (Nasdaq: BIDU) in Uber (English article), the more powerful news broke that the car service provider had quadrupled its fares during the Sydney cafe hostage crisis this week in Australia. This kind of hasty and poorly conceived move convinced me once again that Uber’s global expansion will not succeed in many global markets, especially one like China. Continue reading →
A new report on Starbucks (Nasdaq: SBUX) plans to accelerate its China expansion made me realize just how overheated Shanghai has become with a recent explosion in new coffee shops. In the last 6 months alone, at least a dozen trendy new shops have opened within easy walking distance of my home in an up-and-coming area of the Hongkou District, including 3 or 4 of those by Starbucks itself. Continue reading →
The following press releases and media reports about Chinese companies were carried on December 19. To view a full article or story, click on the link next to the headline.
Microsoft (Nasdaq: MSFT), LeTV (Shenzhen: 300104) In Global Video Cloud Service (Chinese article)
Bottom line: The snowballing of a recent series of mudslinging remarks by major companies underscores the rampant lack of business ethics in China, and could prompt some much-needed public debate on the topic.
What started as a couple of stories highlighting the shady business practices that are all too common in China is starting to snowball, with home appliance giant Gree (Shenzhen: 000651) and a local start-up air purifier maker adding their voices to this entertaining year-end war of words. At the heart of this verbal mudslinging is a toxic Chinese business culture where practices like illegal copycatting, corporate espionage and violation of business contracts are quite common and even accepted to a certain degree. Continue reading →
Bottom line: China and the west will continue to find common interests in fighting corruption, while Beijing’s state support for certain industries will remain an area of contention for the foreseeable future.
Sino-US business ties are on display in 3 separate headlines today, reflecting the increasingly complex relationship between these 2 economic superpowers that sometimes agree but often clash on different issues. One of the few things they agree on is the need to fight corruption, which is the theme in one headline that has the US fining health care products maker Avon (NYSE: AVP) for bribery at its China operation.
But the areas of disagreement are a bit more numerous, including US disapproval of Beijing’s strong state support for industries it wants to develop. That disagreement was at the center of another headline that saw the US finalize anti-dumping tariffs against Chinese solar panels, capping a 3-year-old clash on the issue. Heavy western ownership of globally used technologies is another sore spot, which was in the headlines as the US pressured China on a probe it is conducting into the licensing practices of mobile technology giant Qualcomm (Nasdaq: QCOM). Continue reading →
Cantonese cuisine has become a local favorite in Shanghai these past few years, reflecting the city’s growing taste for both regional and international foods. An interesting twist on that trend has seen China’s financial capital snub higher-end Cantonese food for more down-market chacanting-style restaurants, which are Hong Kong’s equivalent of the local greasy spoon diners in the west. But these Canto diners that have rapidly colonized Shanghai hardly look like their Hong Kong cousins, and have taken on a decidedly mid- to even high-end approach to the dining experience. Continue reading →