MEDIA: Era Ends with Closure of Time Warner’s Former China TV Play

Bottom line: The closure of former Time Warner Chinese TV station CETV reflects the broader decline of traditional broadcasting worldwide, and also heavy restrictions on foreigners for operating video delivery channels in China.

CETV pulled from China airwaves

As Time Warner (NYSE: TWX) pursues a blockbuster merger deal with AT&T (NYSE: T) in the US, a much quieter story in China reflects the end of a frustrating chapter for the entertainment giant and many of its western peers that hoped to make a fortune in the world’s most populous market. That story has the relatively obscure Tom Group (HKEx: 2383) announcing the shuttering of its China Entertainment Television station, also known as CETV. Read Full Post…

CHIPS: Chinese German Chip Buy Hits Regulatory Roadblock

Bottom line: Growing national security concerns are likely to kill the pending purchase of Germany’s Aixtron by a Chinese buyer, and could also kill the pending sale of NXP’s standard products unit to a similar buyer.

Germany calls for review of Aixtron sale to China

A major cross-border chip deal that I failed to notice earlier this year is suddenly in doubt, with word that Germany has reversed course and wants a security review for the proposed sale of local chipmaker Aixtron (Frankfurt: AIXA) to a Chinese buyer. Such a move would mark the first potential killing of a cross-border chip deal in Europe, which would be following the US and Taiwan in voicing concerns about China’s sudden voracity for overseas makers of high-tech microchips. Read Full Post…

China News Digest: October 27, 2016

The following press releases and news reports about China companies were carried on October 27. To view a full article or story, click on the link next to the headline.

  • China Returns to US IPO Market in a Big Way With ZTO Express (English article)
  • Li Ka-Shing’s Tom (HKEx: 2383) Ceases Operation of CETV Television Channel (HKEx announcement)
  • Bank of China HK (HKEx: 2388) to sell 70.5 Pct of its stake in Chiyu Banking (English article)
  • Credit Card Management App Wins $84 Mln Series C+ Funding (English article)
  • EU Approves Chinese HNA’s Acquisition of Swiss SR Technics (English article)
  • Latest calendar for Q2 earnings reports (Earnings calendar)

SMARTPHONES: Oppo Surges, Xiaomi Tries New Look, ZTE Resets

Bottom line: Huawei may have lost its top position in China’s smartphone market in the third quarter, while Xiaomi’s new model with a screen that takes up the entire front surface could bring some buzz back to the company.

Huawei loses ground in China smartphone race

A trio of smartphone headlines nicely summarize the rapid changes constantly gripping the space, where today’s superstar can become little more than a footnote in just a year. The latest rising superstar Oppo is leading the headlines, with a new report saying it overtook Huawei to become China’s smartphone leader in the third quarter. Meantime, former market leader Xiaomi is also in headlines as it rolls out a new intriguing model in a bid to regain its former glory. Last but not least is the faded ZTE (HKEx: 763; Shenzhen: 000063), one of the industry’s oldest players, which is changing smartphone chiefs in its own bid to find new relevance in the tough market. Read Full Post…

INTERNET: Sohu Runs Out of Steam, Borrows from Game Unit

Bottom line: Sohu may be forced to separately sell off its portal, video, search and gaming units over the next 1-2 years, or risk seeing them gradually fall in value as the company’s losses mount.

Sohu plunges after latest results

After running for years as a solid second-tier player, Internet veteran Sohu (Nasdaq: SOHU) is finally showing signs of running out of steam, based on its latest quarterly results and word of a major new loan to the company from its cash-rich but fading Changyou (Nasdaq: CYOU) gaming unit. This kind of turn isn’t all that surprising, since status as a second-tier player should only be temporary and such companies should either aspire to top-tier positions or sell themselves to rivals to ensure their longer term survival.

But Sohu has defied such pressures, largely due to the fiercely independent nature of its founder Charles Zhang, who is both quite shrewd but also famously averse to giving control of his empire to others. These latest results show that Zhang may soon have no choice but to sell some or all of his company, or risk seeing it slowly relegated to oblivion due to pressure from better-run rivals. Read Full Post…

China News Digest: October 26, 2016

The following press releases and news reports about China companies were carried on October 26. To view a full article or story, click on the link next to the headline.

  • Germany Withdraws Approval for Chinese Takeover of Aixtron (Frankfurt: AIXA) (English article)
  • Oppo, Vivo Pass Huawei in China Smartphone Market in Q3 – Counterpoint (Chinese article)
  • ChemChina Ready for Concessions to Clinch Delayed Syngenta Deal: Source (English article)
  • New Oriental (NYSE: EDU) Announces Results for the First Fiscal Quarter (PRNewswire)
  • Student Loan Specialist Qufenqi Posts 540 Mln Yuan Loss in 2015 (Chinese article)
  • Latest calendar for Q2 earnings reports (Earnings calendar)

TRAVEL: HNA Flies to US with $6.5 Bln Hilton Stake Buy

Bottom line: HNA’s $6.5 billion investment in Hilton marks a new high point in Chinese global hotel buying, and signals the trend may be cresting and a downturn could come next year.

HNA invests in Hilton

After I said just last week that China’s recent buying binge of foreign hotels may have crested, we’re seeing yet another blockbuster deal that seems to support that thesis. This latest deal is the biggest to date, and has the acquisitive HNA Group buying 25 percent of US hotel giant Hilton (NYSE: HLT) for about $6.5 billion. That would easily eclipse the other recent blockbuster deal announced just last week, when insurance giant China LIfe (HKEx: 2628; Shanghai: 601628; NYSE: LFC) said it was leading a Chinese group that would invest $2 billion in a portfolio of lower-end US hotels. (previous post) Read Full Post…

Shanghai Street View: River Respite

Shanghai creates Huangpu River walkways
Shanghai rolls out Huangpu River walkways

In 6 years of living in Shanghai, I’ve come to discover my adopted China hometown has a major common characteristic with my US adopted hometown of Los Angeles. Both are major cities that are quite comfortable for people who live there, but are far less notable as tourist destinations.

In this week’s Street View, our city is in the headlines for major new plans that promise to make huge swaths of land on both sides of the Huangpu River friendlier for not only local residents but also tourists. I’ve seen the main plan discussed several times before, but the latest reports say work is already nearing completion on creation of continuous spaces that will allow people to walk for long distances on both sides of the river. Read Full Post…

China News Digest: October 25, 2016

The following press releases and news reports about China companies were carried on October 25. To view a full article or story, click on the link next to the headline.

  • HNA Group Acquires 25 Pct Equity Interest in Hilton (NYSE: HLT) for $6.5 Bln (Businesswire)
  • Syngenta Slumps After EU Watchdog Sparks ChemChina Deal Doubts (English article)
  • (Nasdaq: JD) Corruption Incident Nets More Than 10 Workers (Chinese article)
  • Sohu (Nasdaq: SOHU) Reports Q3 Unaudited Financial Results (PRNewswire)
  • ZTE (HKEx: 763) Replaces Head of Smartphone Division (Chinese article)
  • Latest calendar for Q2 earnings reports (Earnings calendar)

SMARTPHONES: Huawei Slips in Q3, Meizu Gets New Investors

Huawei slips in Q3

The first third-quarter smartphone sales data are out, revealing that Huawei retained its leading position in the fiercely competitive Chinese market. But the high flying Huawei also saw its share drop by more than one percentage point, indicating its momentum may be slowing. At the same time, other reports are saying that Meizu, the Alibaba-backed (NYSE: BABA) smartphone brand that isn’t in the China top 5, has signed on a small group of new investors in a deal that hints at a possible upcoming IPO.

Let’s jump right in with the big-picture numbers, which are coming in new quarterly data from TrendForce. According to that data, Huawei controlled 19.1 percent of the Chinese smartphone market in the third quarter, down from 20.4 percent in the previous quarter. (Chinese article) Total smartphone sales in China reached 168 million for the quarter. Read Full Post…

LEISURE: Wanda Hires from Disney, Google in Global Talent Hunt

Bottom line: China’s Wanda Group will continue a recent trend of hunting for top global talent to build its growing entertainment empire, as it seeks to challenge the likes of Disney.

The aggressively expanding Wanda Group is filling up its ranks with foreign-trained China veterans as it tries to challenge the likes of global names like Disney (NYSE: DIS) with moves into the movie and theme park spaces. Now the company is going on a major shopping spree for top talent from some of those companies, led by new reports that it has just poached a top Disney theme park executive to head its own theme park division. At the same time, other reports are pointing out that Wanda also recently hired Google’s (Nasdaq: GOOG) former top China executive to help lead its Internet division. Read Full Post…