Journalist China

A growing scandal around Sinopec (NYSE: SNP; HKEx: 386) points to a looming crackdown by Beijing on its three major oil companies, all basking in fat profits under the country’s current fuel pricing regime. First things first. The scandal that’s been making headlines is relatively small by itself, blasting Sinopec’s Guangdong branch for spending lavishly on liquor at several recent internal events (English article; Chinese article) Obviously this is bad publicity for Sinopec, but more importantly it’s a sign of the growing public discontent at how these companies are posting fat profits at the expense of ordinary citizens who see themselves being exploited by Sinopec and its two main rivals, CNOOC (NYSE: CEO; HKEx: 883) and PetroChina (NYSE: PTR; HKEx: 857; Shanghai: 601857). In the past week alone, two friends have complained to me that Chinese gas prices are now higher than those in the US, a rarity in these times. Given all the noise, combined with Beijing’s worries about inflation, it’s just a matter of time, probably months or even weeks, before Beijing takes action to rein in fuel prices.

Bottom line: Public anger over high fuel prices and Beijing’s resolve to tame inflation mean the days of fat profits for China’s oil majors are numbered.

中石化“天价酒”事件昭示中央政府“修理”三大油企的日子越来越近。先说一下事件原委。事件本身并不算大，媒体抨击广东石化在多次内部活动中用酒极其奢侈，这显然大损中石化公关形象，但更重要的是，事件是一种民意对石油三巨头日趋不满的彰显：三巨头财源广进，百姓却遭赤裸剥削。仅过去一周中就有两个朋友向我抱怨，中国油价现在已超过美国，这在时下两国物价的对比中尚属罕见。抱怨四起、政府心忧通胀，中国抑制油价只是时间问题，可能也就在这几个月甚至几周。

一句话：民众严重不满高油价、政府决心控通胀，中国大油企“高利润”时代即将寿终正寝。

Related postings 相关文章:

◙ China’s Oil Shuffle: Not So Fast, Naysayers 石油巨头高管轮换：先别急着唱衰

◙ PetroChina Gets in Bed wtih Saudis to Secure Oil Supplies 中石油的沙特“情缘”

◙ Oops: Beijing thows oil majors a meager bone

Anyone who doubted that Chinese Internet giant Tencent (HKEx: 700) was serious about video sharing should think again. In the latest of a string of reports on the company’s intentions in that space, Chinese media are reporting the company best known for its QQ instant messaging service has earmarked 500 million yuan, or nearly $100 million, to develop content for its own video sharing service (English article; Chinese article) This news comes not long after Tencent formed a video alliance with several other firms who agreed that content obtained by any member would be shared by all. (previous post) Add to that Tencent’s own investment in another video sharing firm, Xunlei, and I think you begin to see the picture: Tencent is serious about this business. Given its previous strong track record at developing new businesses, I’d say that smaller rivals like Youku (NYSE: YOKU) and Tudou, as well as other newcomers like Shanda (Nasdaq: SNDA) should take note that a major new rival is taking shape. Who knows, maybe one day they could even challenge the likes of global giant Youtube.

Bottom line: Tencent’s commitment to video stands a good chance of success, boding well for its own bottom line but poorly for domestic rivals like Tudou and Youku.

任何质疑腾讯<0700.HK>对视频分享业务重视程度的人都应重新思考一下了。近期有一系列关於腾讯有意进军该领域的报导。中国媒体最新报导称，腾讯已拨出5亿元人民币专款，用於发展其视频分享服务。此前不久，腾讯与多家视频网站结成一个视频版权联盟，其中的所有成员均可互享视频内容。再加上腾讯直接投资於视频分享网站迅雷，我想你们已开始看到：腾讯非常重视视频业务。鉴於腾讯以往开发新业务的战绩，我想说，优酷网、土豆网等规模较小的竞争对手以及盛大等新手都应重视这个正在成形的强大竞争者。谁知道呢，或许有一天，腾讯甚至能挑战Youtube等全球视频巨头。

一句话：腾讯进军视频业，成功机率很大，对自身发展是个良机，但对土豆网和优酷网等国内竞争对手可能是个坏消息。

Related postings 有关文章:

◙ Tencent Takes on Video Sharing in New Alliance 腾讯觊觎视频霸主地位

◙ Tencent Chases a Faded Giant in Myspace 腾讯竞购末路英雄Myspace

◙ Watch Out Youku: Google-backed Xunlei Marching to Market

There’s interesting news in China’s new energy sector, where leading wind power producer Longyuan Electric Power (HKEx: 916) has tied up with Spanish wind turbine giant Gamesa (Madrid: GAM) to explore global expansion opportunities. (English article) This is exactly the kind of tie-up that China’s export hungry alternate energy firms need to be making if they really want to compete on the global stage, linking up with strong international partners with ties in those markets. In this case, Gamesa brings not only ties in its home EU market, but also throughout Latin America where Spain also has long connections. Of course only time will tell if Longyuan can get any major benefits from this tie-up. But the combination of its low-cost manufacturing and support from Beijing, combined with Gamesa’s own expertise and global connections, could prove a potent combination for this pair and be a big contributor to their profits going forward.

Bottom line: It’s still early days, but this new tie-up between Longyuan and Gamesa could breathe new life into the global wind power sector, as well as both companies’ bottom lines.

中国新能源产业出现了一条有意思的新闻：中国风能领军企业龙源电力<0916.HK>已与西班牙风力涡轮巨头歌美飒（Gamesa）<GAM.MC>合作，联手探索全球风能市场扩张机遇。如果那些急於出口的中国新能源企业确实希望在全球市场参与竞争，他们就需要开展这样的合作，即与已经进入其它市场的海外大型公司携手。在这一案例中，歌美飒不仅带来其在欧盟市场的纽带，还引入了与西班牙渊源已久的拉美地区的关系网。当然，龙源电力能否从这一合作中获利颇丰，还只能靠时间来证明。但凭借龙源电力的较低制造成本、中国政府的支持，加上歌美飒的专业技术和全球业务纽带，两者或能实现强强联合，为双方都带来巨大收益。

一句话：现在下结论还为时尚早，但龙源电力与歌美飒的合作或能给全球风能产业吹来新的生机，并为两家企业带来盈利。

Related postings 有关文章:

◙ 3M Jumping on China Solar Bandwagon 3M进军中国太阳能产业

◙ Suntech Shines With Solar Services 尚德：进军太阳能服务业

◙ Japan Nuclear Woes Brighten Outlook for Solar Firms 日本核危机提振太阳能公司前景

Top Chinese coal maker Shenhua (HKEx: 1088; Shanghai: 601088) may be firing up its engines for global M&A with its massive new capital raising plan, but it looks like domestic rival Yanzhou Coal (HKEx: 1171; Shanghai: 600188) may be first to land a major deal this year on that front. (English article) An unnamed source has told Reuters that Shenhua was actually also in the bidding for Australia’s Whitehaven Coal, and so was another domestic firm, China Coal Energy (HKEx: 1898; Shanghai: 601898), but those two have dropped out leaving Yanzhou as China’s sole representative. What all of this says is that Chinese companies are clearly out there hunting for overseas coal assets to feed China’s hungry economy — good for anyone selling such assets. As the most experienced of the Chinese trio in global M&A, Yanzhou may have an edge over its domestic rivals in the short term, and may even be willing to pay a premium for Whitehaven, which is valued at more than $3 billion. But I would look for Shenhua to get more aggressive in the months ahead, and China Coal could also end the year with a smaller deal or two.

Bottom line: China’s coal makers have been given the resources to do global M&A by Beijing, and are likely to land one or two major deals this year.

中国神华能源<601088.SS><1088.HK>在沪港两市进行大规模配股再融资，可能是在为海外并购举措作准备。但以目前情况来看，兖州煤业<600188.SS><1171.HK>也许会成为今年首个敲定大规模海外并购协议的中国煤企。一位不具名的消息人士告诉路透社，实际上，神华与中煤能源<601898.SS><1898.HK>也曾参与竞购澳大利亚煤矿商Whitehaven Coal，但这两家目前均已退出，让兖州煤业成为中方唯一竞购代表。这些情况均表明，中国企业收购海外煤矿资源的步伐明显加快，以满足国内经济发展需要，这对於任何出售此类资产的人来说都是良机。作为三家参与海外并购的煤企中最有经验的一家，兖州煤业在短期内或比国内对手更具优势，甚至可能愿意溢价竞购Whitehaven，後者估值超过30亿美元。但我认为，神华将在未来数月更具野心，而中煤在年底前可能也会完成规模较小的一两宗收购。

一句话：中国煤炭企业进行海外并购得到了本国政府支持，今年有望敲定一两宗规模可观的并购协议。

Related postings 有关文章:

◙ Shenhua Rights Issue Smells of Overseas M&A 神华能源可能进行海外并购

◙ PetroChina Gets in Bed wtih Saudis to Secure Oil Supplies 中石油的沙特“情缘”

The regulator’s estimate that China’s banks will need another huge cash infusion over the next 6 years to meet stricter capital requirements probably come as a big surprise to no one. But the amount — a whopping $131 billion — is probably raising a few eyebrows, especially after shareholders just gave the nation’s top banks well over $100 billion combined last year for the same reason. (English article) If I owned shares in any of these banks, which I don’t, the thought of investing more in them in the near future just to keep my stake from getting diluted certainly wouldn’t make me too happy. But then again, anyone who invests in Chinese banks is surely doing so at least partly because he or she knows that these banks are 100 percent guaranteed by the government and, as a foundation of the Chinese economy, are even more important than the Western banks that were later called “too big to fail.” I’d say to look for the banks to start begging again as soon as 2012, as that will give them at least one calendar year (i.e. 2011) when they didn’t need to ask shareholders for more money. And to those shareholders who complain when the future cash calls come, I can only say one thing: the “too big to fail” guarantee from Beijing comes with a big price tag.

Bottom line: Chinese banks look like a bad investment for the next few years, as a new round of cash calls looms.

监管机构估计，中国银行业未来六年将需筹集1,310亿美元的股权资本，来满足更加严格的资本充足规定。这一数额或许会让某些人惊讶不已，特别是中资银行去年刚以同样理由从股东们那里筹集了1,000多亿美元。如果我持有其中任何一家中资银行的股票(事实是我没有)，不远的将来我需要对它们进行更多投资，以使我的股票不被稀释，这种想法肯定不令人高兴。但话又说回来，任何投资中资银行的人肯定在这麽做，部分原因是他们知道这些银行是百分之百政府担保的，而且作为中国经济一个基石，中资银行比所谓“大而不能倒”的西方银行更为重要。我认为中资银行最快会在2012年开始寻求筹资，这将使他们至少有一年时间无需向股东要钱。对那些抱怨筹资的股东们，我只能说：中国政府对中资银行的担保是伴随巨大代价的。

一句话：未来几年，投资中资银行似乎不是个好主意，因新一轮筹资活动即将出现。

Related postings 有关文章:

◙ Banks: CCB Bets on Downturn, BOC Keeps Head in Sand 中行依旧高歌猛进，建行趋向保守

◙ Ping An, Beggars Cup in Hand, Looks Worrisome

◙ NPC: Same Old Same Old, China Mobile Hypes 4G, More Handouts for Bank of China

UPDATE: Since first posting this, 7 Days has informed me that, indeed, the $65 million investment from Warburg was old news, coming in 2008. That would explain the strangeness of this investment if it had been a new one, which I already noted below

There’s a couple of interesting news bits coming from the budget hotel world that each could have interesting implications for the fast growing sector. In the bigger of the two, Morgan Stanley looks like it may abort the sale of its 60 percent stake in Shanghai Motel Management, operator of the Motel 168 chain, after it failed to get the kind of frothy bids it was seeking from a list of suitors that included China’s top two operators, Home Inn (Nasdaq: HMIN) and China Lodging Group (Nasdaq: HTHT), and French giant Accor. (English story) It’s been pretty clear all along that Morgan Stanley was hyping this deal through repeated unsourced leaks, hoping it could get as much as $1 billion for a stake that certainly wasn’t worth nearly that much. In the second piece of news, Guangzhou-based operator 7 Days (NYSE: SVN) has received a somewhat strange investment of $65 million, according to a Chinese media report (English article)  Why a company with a $900 million market cap would want such a small private investment seems odd, but maybe it’s related to the investors, which in this case happen to include Warburg Pincus. With an worldly partner like that at the lodge, look for some interesting developments from this relatively low-key budget player in the months ahead.

Bottom line: Morgan Stanley will quietly sell its China budget hotel stake for well below its original $1 billion asking price, while interesting days await the 7 Days chain after a Warburg Pincus investment.

更新：登了这个文章后，7天通知我Warburg的投资是旧闻，来在2008年。这样会解释我写的奇怪如果这投资是新的。

经济型酒店业有两则有趣的新闻，每条都可能给这个快速发展的行业带来有趣的影响。第一条新闻，看起来摩根士丹利可能会放弃出售持有的上海莫泰酒店管理有限公司60%的股权，因它并未从竞标者中得到有力报价。上海莫泰是经济型连锁酒店“莫泰168”的运营商。很明显，大摩一直都在试图通过所谓的消息人士来炒作这一交易，以期能以10亿美元将其股权售出。另一条新闻是，据中国媒体报导，总部位於广州的7天连锁酒店获得了6,500万美元的奇怪注资。一家拥有9亿美元市值的企业却要这麽一小笔私人投资似乎很奇怪，但或许这与此事的投资人有关，此事牵涉到了美国华平投资集团(Warburg Pincus)。有了这麽一个精明的合作夥伴，相信未来数月，这个相对低调的经济型酒店会有一些有趣进展。

一句话：摩根士丹利将以远低於其10亿美元的报价悄悄卖出莫泰股权，而有了美国华平的投资，7天连锁酒店未来料有有趣进展。

Related postings 有关文章:

◙ Disney Shanghai: A Great Hotel Play

◙ 7 Days vs Home Inns: A Tale of Two Hotel Chains?

◙ Motel 168: Hot Property in Budget Chains

There’s a bit of good news coming from the telecoms equipment sector, where Huawei and Motorola have settled their months-old dispute that saw the former sue the latter for stealing intellectual property. (English article; Chinese article) Terms of the settlement are really a secondary issue here, and what’s most important is that this brings the matter to an end and lets everyone move on with their lives. The dispute was already causing a number of major interruptions in the sector, most notably holding up Nokia Siemens Networks’ pending acquisition of Motorola’s networking business. Chinese regulators were hesitating to approve the deal, and many suspected the Huawei lawsuit was the main reason. This settlement could also give a boost to Huawei’s own aspirations to get into the US market, as it will look like a sign of goodwill from a Chinese company in a dispute with a struggling US counterpart.

Bottom line: Resolution of Huawei’s lawsuit with Motorola will allow NSN to close its purchase of Motorola’s networking assets, and could give Huawei’s US aspirations new momentum.

电信设备业传来一个好消息：华为和摩托罗拉已就双方的知识产权纠纷达成和解。和解内容显然是次要的，最重要的是，和解让此事归于结束，各方均可继续推进其业务。这场纠纷已使该行业一些业务受到干扰，其中最知名的就是摩托罗拉与诺基亚西门子通信(NSN)之间的收购交易被搁置。中国监管部门迟迟未就该交易作出批复，很多人怀疑华为起诉案是主要原因。此事的和解也有助於华为进军美国市场，因在与一个陷入困境的美国同业者的纠纷案中，中国公司看起来像是作出了善意姿态。

一句话：华为与摩托罗拉和解将使诺西得以完成对摩托罗拉网络资产的收购，并使华为获得进军美国市场的新动力。

Related postings 有关文章:

◙ ZTE Pressures Ericsson With China Suit — NOT 中兴反诉爱立信

◙ 4G Trials: Motorola, NSN Surprising Winners 摩托罗拉意外赢得中移动4G试点合同

◙ Huawei: Strength in Separation? 华为：大胆尝试“本土化管理”

Another race is shaping up to be first to market between two of China’s leading social networking sites, Kaixin Wang (Chinese report) and Renren (English report; Chinese report). The reports are all pretty sketchy and quote unnamed sources, but the general idea is that both companies have hired investment banks with an aim to listing in New York as early as next month, though neither has made any filings yet. All this seems remarkable reminiscent of a similar race last year, that saw video sharing site Youku (NYSE: YOKU) ultimately beat out rival Tudou, receiving a handsome premium for its first-to-market status even though neither company earns any profit yet. It’s difficult to say who is better positioned in this current race, since neither company is saying much. But odds are that the first to list will also be rewarded with a handsome premium from overseas investors keen to buy into its latest hot Internet playy.

Bottom line: Either Kaixin Wang or Renren will get a handsome premium when it goes public, depending on who gets to market first.

据报导，中国两大社交网站——开心网和人人网也在准备展开一场上市大战。这些报导全都语焉不详，消息也均来自不具名知情人士，但大意是：两家公司均已聘请投行，力争最早下月在纽约上市，但两者均未正式提交上市文件。这一幕似曾相识。去年，视频分享网站优酷网最终击败土豆网，抢先在美国上市，并作为市场先行者获得高额溢价，尽管这两家公司迄今均未盈利。在开心网和人人网的这场竞争中，因为两家公司口风都很紧，很难说谁处于优势。但和优酷网一样，此次抢占先机者料将获得海外投资者的高额溢价追捧。

一句话：不管是开心还是人人，谁能抢先上市，谁就能获得不错的溢价追捧。

Related postings 有关文章:

◙ Facebook’s China Tie Up: No Big Deal Facebook能否入华？

◙ Ren Ren chases me-too IPO

◙ Take a Deep Breath: China IPO Flood Looms 中国概念股又一春？

It looks like ZTE (HKEx: 763; Shenzhen: 000063), a former rising star now facing conflicts on several fronts, is finally fighting back in one of those battles by countersuing global rival Ericsson (Stockholm: ERICb) in China. (Chinese article) Yes, you heard that right — ZTE is taking its action in Chinese court, after Ericsson sued it for patent infringement in Europe. Please excuse me if I’m not taking this seriously enough, but anyone who expects to get anything from a lawsuit in Chinese court is only fooling himself. Chinese courts are famous for taking years to reach judgments in these matters, often making the final verdicts meaningless as the technology is already outdated when the decision comes. Furthermore, damages are often tiny even when the courts decide for the plaintiffs. A source at ZTE tells me the company hasn’t ruled out suing Ericsson overseas as well. To all of that, my only comment is that ZTE needs to get a bit more sophisticated in its litigation strategy if it really wants to compete with the big boys on the global networking stage.

Bottom line: ZTE’s countersuit in China against Ericsson is a meaningless move that shows its lack of sophistication in doing global business.

中兴通讯(0763.HK: 行情)(000063.SZ: 行情)正在多条阵线面临冲突，但现在似乎终于开始发起反击——它已在中国对爱立信(ERICb.ST: 行情)提出反诉。是的，你没听错，爱立信在欧洲起诉中兴侵犯其专利後，中兴正在中国采取侵权反诉行动。要是我没太把这当回事，请原谅我，但在中国，审理此类诉讼往往耗时数年，从而使最终作出的判决失去任何意义，因为届时相关技术早已过时。此外，即使原告胜诉，法院判决的赔偿额通常也微不足道。中兴公司的一位消息人士告诉我，该公司并未排除在海外起诉爱立信的可能。总之，我的唯一评论是，中兴若真想与行业巨头在全球通讯网络市场竞争，就需要在司法策略方面多下点功夫。

一句话：中兴在华起诉爱立信之举毫无意义，只表明它在开展全球业务时还显得十分稚嫩。

Related postings 有关文章:

◙ ZTE, Huawei Stumble Some More 华为中兴：难兄难弟

◙ Another Blow For Beleaguered ZTE 中兴通讯：挫折连连

◙ ZTE US, India Moves Smell of Desperation 中兴通讯急了

An announcement by leading Chinese coal producer Shenhua Energy (HKEx: 1088; Shanghai: 601088) that it could raise a whopping 160 billion yuan, or more than $20 billion, through rights offerings in Hong Kong and Shanghai seems to have gone largely unnoticed, perhaps because it came in a Sunday filing in Shanghai (English article; Chinese filing) The few reports I saw didn’t add much more, though some quoted analysts saying Shenhua already has plenty of cash. Excuse me if I’m missing something, but it seems a fund raising of this proportion, far bigger than what most of the major banks did last year, has M&A written all over it, most likely overseas. It would make total sense, as China’s oil majors, PetroChina (NYSE: PTR; HKEx: 857; Shanghai: 601857), Sinopec (NYSE: SNP; HKEx: 386) and CNOOC (NYSE: CEO; HKEx: 883), have all been active on this front under orders from Beijing to secure energy to feed China’s buzzing economy. Just where we might see Shenhua do its first major overseas M&A remains to be determined, but I would expect a major deal in the next 12 months.

Bottom line: Look for a major overseas purchase from Shenhua in the next 12 months.

有报导说，中国神华能源(1088.HK: 行情)(601088.SS: 行情)已宣布将在沪港两市进行价值或高达1,600亿元人民币的配股再融资。但或许因为该公告是周日在上海发布的，似乎多数人都没有注意到。我看到的少数报导并未谈及更多内容，尽管部分文章援引分析师的话说，神华其实已经握有充足的现金。如果我的论述有所遗漏还请见谅，但上述融资规模远远超过了去年多数大型银行的再融资规模——可以说处处带有并购意图的印记，而且很可能是在海外进行并购。海外并购其实很有道理。为确保能源供应，中国政府已要求中石油(0857.HK: 行情)(PTR.N: 行情)、中石化(0386.HK: 行情)(SNP.N: 行情)、中海油(0883.HK: 行情)(CEO.N: 行情)等企业积极进行海外并购。神华将在何处进行首次海外重大并购还是个未知数，但我预计，该公司会在未来一年内进行一次大规模的海外并购。

一句话：神华能源未来一年内料将进行一次规模可观的海外收购。

Related postings 有关文章:

◙ PetroChina Gets in Bed wtih Saudis to Secure Oil Supplies 中石油的沙特“情缘”

◙ China’s Oil Shuffle: Not So Fast, Naysayers 石油巨头高管轮换：先别急着唱衰

I have to say that the latest reports that Tencent (HKEx: 700) is mulling a bid for News Corp’s (Nasdaq: NWSA) faded social networking site Myspace left me a bit puzzled. (English report; Chinese report) My only explanation is that China’s leading Internet company has way too much cash in its coffers and doesn’t know what to do with it. In many ways, Myspace is like former Internet giant AOL, which looked unbeatable in its heyday and is now struggling just to stay alive. Then again, Tencent’s interest shouldn’t come as a huge surprise, following its bid last year in another faded social networking giant, Friendster. Luckily for Tencent, it ultimately lost in the bidding war for that company, and if it’s lucky Tencent will lose in the bidding for Myspace as well. Who knows: perhaps all these bids are just a performance for Tencent to show shareholders it’s looking for overseas investments to expand the business. But my guess is that these attempts are really serious, and could leave Tencent with major liabilities if it ever succeeds in buying one of these faded giants.

Bottom line: If Tencent is smart, it will stop chasing washed-up Internet giants and focus its overseas M&A efforts on young firms with good growth potential.

不得不说，最近有关腾讯<0700.HK>打算收购新闻集团<NWSA.O>旗下没落的社交网站Myspace的报导着实让我有点摸不着头脑。我唯一的解释只能是，这家中国领先的互联网公司实在是现金太多了，不知道该如何花。在很多方面，Myspace就好像昔日的互联网巨头AOL——鼎盛时看起来无坚不摧，如今却苟延残喘。但腾讯的收购意向不应该太让人意外，因去年它就曾竞购另一家没落的社交网站巨头 Friendster。幸运的是，腾讯对那家公司的竞购没有成功。如果腾讯再次输掉Myspace竞购战，那也会是一桩幸事。但谁知道呢，也许腾讯竞购这些公司只不过是演戏给股东看，告诉他们公司在寻找海外投资对象，以扩展业务。不过，我猜腾讯还是认真的，而如果腾讯成功购得这些昔日巨头中的任何一家，恐怕都要承担与之相关的大规模债务。底线是，如果腾讯够聪明，那就不要再追逐这些互联网业过气明星，而要把海外并购力量集中在增长潜力良好的年轻公司身上。

一句话： 腾讯如果聪明会放掉追求过时老网行，而会注意年轻而有前途的公司上。

Related postings 有关文章:

◙ Facebook’s China Tie Up: No Big Deal

◙ Tencent Takes on Video Sharing in New Alliance 腾讯觊觎视频霸主地位

◙ Snaptu: Facebook’s China Back Door? Facebook在中国走“後门”？