The following press releases and media reports about Chinese companies were carried on November 27. To view a full article or story, click on the link next to the headline.
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- Renault (Paris: RENA) Plans China Car Venture With Dongfeng (HKEx: 489): Reports (English article)
- Starbucks (Nasdaq: SBUX) Strengthens China Commitment With 100th Beijing Store (Businesswire)
- Shanda Sells Nut Shell to Mobile Internet Company (English article)
- 11 Group Buying Sites Close in October, Pace of Bankruptcies Slows (Chinese article)
- Ming Yang (NYSE: MY) In Financing Framework Deal With Reliance, China Dev Bank (PRNewswire)
China Eastern’s (HKEx: 670; Shanghai: 600115; NYSE: CEA) announcement of a massive new order for Airbus (Paris: EAD) planes last week looked suspiciously political, coming just after China and the EU resolved an aviation-related dispute. If politics were indeed a factor, which seems likely, Beijing set another unhelpful precedent by tying what should have been a purely commercial decision to non-commercial factors. By continuing to act this way, Beijing will show the world that it calls the shots for what should otherwise be big commercial decisions by Chinese companies rather than leaving those decisions to market forces. That will only give China’s opponents further fuel in their steady accusations of unfair trade by Beijing.
New noises are coming from online video site Xunlei and e-commerce giant Jingdong Mall that indicate a US or Hong Kong IPO or other equity sale may be coming soon, as each looks for new cash to fund its money-losing operations. But that said, the latest signals from these 2 Internet companies indicate that neither will be able to tap a rare window in the offshore IPO market that appeared last week when commercially-focused social networking site YY (Nasdaq: YY) made the first successful public offering by a Chinese firm in New York in more than a year. (
An internal company memo penned by Robin Li, one of China’s richest men and founder of Baidu (Nasdaq: BIDU), has been buzzing through the domestic media, which are interpreting the message as the sign of a looming crisis at the nation’s leading search engine. The theme of the memo revolves around the concept of the “Wolf Spirit”, which Li says has been lost at his company that pioneered the online search market in China. (
China’s young insurance market has proven attractive to foreign players for its huge potential, but has also been an extremely difficult place for them to do business due to numerous obstacles and competition from local players. That reality appears to be a major factor behind an uneasy alliance that has just been announced between US insurance giant AIG (NYSE: AIG) and Chinese counterpart PICC Group, who have signaled their intent to form a life insurance joint venture just as PICC is raising up to $3.6 billion in a Hong Kong IPO.
I was surprised to see reports today that Alibaba and Sina (Nasdaq: SINA) have reached an impasse in their rumored negotiations for the former to buy a strategic stake in the latter, since both sides clearly want this deal to happen as it would greatly benefit both. But then I had a closer look at the reports, and my conclusion is simply that the 2 sides are still negotiating in an attempt to place a value on Sina, whose popular and increasingly influential Weibo microblogging service lies at the heart of their planned tie-up. Such disagreement is standard for this kind of negotiation, and I fully expect the 2 sides to reach a deal that should be one of the most significant tie-ups we’ve seen for China’s Internet space since the merger of leading online video sites Youku (NYSE: YOKU) and Tudou earlier this year.
A couple of items in the news today are shining a spotlight on the very real and unique risks of doing business in China from heavy-handed government oversight, with fast-rising smartphone maker Xiaomi and Internet giant Tencent (HKEx: 700) both sparring with Beijing in different own ways. Xiaomi’s situation looks the most serious with the “temporary” suspension of its newly launched Internet TV service, which probably reflects the company’s youth and inexperience at dealing with government bureaucrats. Tencent also appears to be playing a game of brinksmanship with Beijing by bringing its own unusual interpretation to a controversial “real name” registration requirement imposed on all social networking sites early this year.
No one is writing very much about China Unicom’s (HKEx: 762; NYSE: CHU) newly announced plan to buy fixed-line networking assets from its parent, perhaps because people have lost all interest in this laggard telco that has been mired in management disorder for much of the last 2 years. Despite my own negative feelings about the company’s recent performance, I’m going to go ahead and actually praise Unicom for the move, as it finally looks like the company is doing something that has a small hint of being driven by a broader corporate strategy — something we haven’t seen for quite a while.
The prolonged winter for Chinese IPOs in New York may finally be nearing an end, following the modestly successful listing of commercially-focused social media site YY (Nasdaq: YY). I am calling this listing “modestly successful” because it priced at the low end of its range and rose a modest 8 percent on its trading debut, which would be a good but not a great result under most circumstances. But against the broader background of a deep freeze in US investor sentiment towards Chinese companies over the last year and a half, this kind of performance could actually be considered a major breakthrough and triumph for the battered sector.
