The following press releases and media reports about Chinese companies were carried on May 16-18. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Sued In US By Luxury Brands Over Counterfeit Goods (English article)
Netflix (Nasdaq: NFLX) Tops $600 A Share, Said In Talks To Enter China (English article)
iQiyi Denies Rumors of Merger With Youku Tudou (NYSE: YOKU) (English article)
Chinese Mobile Users In Dark Over Cut-Price Data Deals (English article)
Yum (NYSE: YUM) China Spinoff Becoming More Probable: JPMorgan (English article)
Bottom line: A merger between Youku Tudou and iQiyi looks like a strong possibility because it would greatly benefit both companies, creating a clear market leader to rival LeTV and traditional broadcasters.
Youku Tudou in merger talks with iQiyi?
Rumors that former online video leader Youku Tudou (NYSE: YOKU) is in talks to merge with rival iQiyi have reignited interest in the former’s beleaguered stock, as investors get excited about another landmark deal in the space. Youku Tudou’s shares soared 17 percent in the latest trading session, and have now nearly doubled since the beginning of April.
The sourcing is quite vague on the reported talks for a merger with iQiyi, which is owned by online search leader Baidu (Nasdaq: BIDU). But I would give the reports a strong chance of being true, as this kind of a move seems consistent with past behavior of Youku Tudou’s CEO Victor Koo, who is highly practical and thus would seriously consider selling his company if such a move made financial sense. Read Full Post…
Bottom line: Apple’s latest environmental initiative in China looks like a savvy and inexpensive way to raise local awareness of environmental protection, in a move that will please Beijing and help it improve its government relations.
Apple tries forest management
Just 3 weeks after capturing local headlines with its plans to invest in solar farms in China, global gadget leader Apple (Nasdaq: AAPL) is rolling out more environmentally friendly initiatives in an attempt to woo both consumers and government officials in one of its most important markets. This latest initiative probably won’t get much attention in western media, as it looks mostly like a publicity ploy even though it does lay out big goals. But foreigners were never Apple’s real target with this announcement, which instead is part of its recent campaign to win over Beijing as well as a broader base of Chinese consumers. Read Full Post…
The following press releases and media reports about Chinese companies were carried on May 15. To view a full article or story, click on the link next to the headline.
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Lenovo (HKEx: 992) To Spin Off Smart TV Unit As JV With Alibaba (NYSE: BABA) (English article)
Youku Tudou (NYSE: YOKU) In Merger Talks With iQiyi – Market Talk (Chinese article)
Xiaomi Smartphone Sales Rise 36 Pct To 15 Mln Units In Q1 (Chinese article)
Sina (Nasdaq: SINA) Reports Q1 2015 Financial Results (PRNewswire)
Bottom line: The latest sporting deals by LeTV, Wanda and Alibaba reflect a growing scramble to secure broadcast rights and develop sports channels in China, with more such deals likely in the year ahead.
Alibaba wins NCAA rights for China
A nascent but growing move by China’s top private companies into global sports is in 2 separate headlines, with word of significant new deals involving e-commerce giant Alibaba (NYSE: BABA) and video superstar LeTV (Shenzhen: 300104). The stories also involve the entertainment ambitions of real estate magnate Wang Jianlin, one of China’s richest men, whose Wanda Group has been at the center of 2 major global sports deals over the past year.
The first of the newest deals will see Alibaba bring US college basketball to China through a deal with the National Collegiate Athletic Association (NCAA), the main governing body for US college sports. The other deal has seen LeTV, China’s most valuable provider of Internet video services, raise 800 million yuan ($130 million) for its young sports division. One of the main backers in that new funding round was Wang Jianlin’s son, Wang Shicong. Read Full Post…
Bottom line: Apple CEO Tim Cook’s latest meetings in Beijing are important steps in his bid to cultivate better government relations, but he may need to make more substantive moves to earn serious goodwill.
Apple’s Cook meets with Chinese vice premier
We’ll continue this week’s tradition of closely following Apple (Nasdaq: AAPL) CEO Tim Cook on his latest trip to China, with word that he’s met with one of the nation’s vice premiers and also with officials from China Telecom (HKEx: 728; NYSE: CHA), one of its 3 big state-run telcos. I’ll begin with just a slight note of cynicism by saying that both of these meetings seem just slightly second-tier, for reasons I’ll explain shortly, and therefore one could argue that Cook has yet to make it into the “big leagues” of Chinese politics.
But that said, these and other visits on this trip still mark a huge step forward for both Cook and Apple, which just 2 years ago were criticized by the powerful People’s Daily, the official newspaper of the Communist Party, for its unparalleled arrogance. Cook has been working hard to change that image, and this particular weeklong trip seems to be almost as much about public relations as it is about doing business. Read Full Post…
Bottom line: A new wave of traditional Chinese firms are taking new high-tech names to fool local investors who often buy stocks with little or no knowledge of the companies, and should serve as a warning to foreigners interested in Chinese shares.
Real estate firm renames itself as Pi Tu Pi
An entertaining local media report is poking fun at the latest trend among Chinese companies, which is seeing many adopt high-tech sounding names in a bid to convince unsavvy investors that they are engaged in high-growth industries. But all joking aside, the report also casts a very real spotlight on the dangers of buying Chinese stocks for average international investors, who have been ramping up their purchasing via Hong Kong following the launch last year of the landmark Hong Kong-Shanghai connect program. Read Full Post…
The following press releases and media reports about Chinese companies were carried on May 14. To view a full article or story, click on the link next to the headline.
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Chinese Vice Premier Meets Apple (Nasdaq: AAPL) CEO (English article)
Bottom line: Apple is likely to reach a deal to bring Apple Pay to China in the next 12 months, while Xiaomi’s addition of traditional offline sales channels acknowledges it needs to diversify its approach to maintain its breakneck growth.
Cook eyes Apple Pay for China
The old saying “An apple a day” seems to be appropriate this week in China, where Apple’s (Nasdaq: AAPL) CEO Tim Cook is being quite talkative on his latest China trip with a steady stream of small but noteworthy news. He began the week by announcing a new environmental China initiative for Apple, then followed by launching his own microblog on the locally popular Sina Weibo (Nasdaq: WB), often called the Twitter of China. (previous post)
Now he’s candidly talking about hopes for bringing his company’s Apple Pay electronic payments service to China, perhaps through tie-ups with local e-commerce giant Alibaba (NYSE: BABA) or UnionPay, China’s largest electronic transactions network operator. Read Full Post…
Bottom line: A worker rebellion over layoffs at an online recruitment site being bought by 58.com underscores the company’s inexperience at M&A, even though the purchase itself looks like a good move.
Workers rebel over layoffs at ChinaHR
Chinese media are flocking to news that leading online classified ad site 58.com (NYSE: WUBA) has begun slashing jobs at its newly acquired ChinaHR, just days after it announced it would purchase the struggling online recruitment site. The move looks a bit hasty and perhaps extreme, and also comes across as just slightly ironic since many people now losing their jobs may soon have to use rival services to find new work.
But irony aside, this particular story looks quite similar to something that happened just 2 years ago at the very same ChinaHR. In that case workers mutinied and even briefly held an executive hostage after its then-owner, US online recruitment giant Monster Worldwide (Nasdaq: MWW), also tried to lay off employees as part of its own plans to sell the company. If history repeats itself, which is showing early signs of happening, 58.com could be looking at some turbulent times ahead over the next week or two. Read Full Post…
Bottom line: Recent raids on Uber’s offices in 2 major Chinese cities reflect resistance it is meeting from traditional taxi operators, which could significantly limit its growth potential in the politically sensitive market.
Uber’s offices raided in Chengdu, Guangzhou
The turmoil in China’s overheated market for paid car services has cruised into the offices of global fast-riser Uber, which has been raided twice in the last 2 weeks over its aggressive move into the market. The first raid came last week, when local officials visited the company’s offices in the southern metropolis of Guangzhou, sometimes also called Canton. (Chinese article) Now the raids have extended to the interior city of Chengdu, where Uber’s offices have again been visited by local officials conducting an unspecified investigation. (English article) Read Full Post…
