The headlines have been buzzing this week with news of a management-led privatization offer for leading outdoor advertising firm Focus Media (Nasdaq: FMCN), marking the latest in a recent string of developments that I suspect will end with a sale of this colorful but faded company. The buyout is the latest in a series of similar plans by US-listed Chinese firms in recent months, following a series of accounting scandals that have caused shares of the entire sector to tumble.
Beijing Funds Solar Consolidation 中国政府或继续向光伏行业提供资金支持
A new announcement from solar panel maker Canadian Solar (Nasdaq: CSIQ) indicates that Beijing may be preparing to help fund a much-needed consolidation in the oversupplied sector. The news should be welcome by money-losing Chinese solar companies in general, as it indicates that Beijing will continue to provide them with funds to continue their operations as private sector options evaporate. But the move will inevitably raise new complaints from foreign rivals, who will say this funding is exactly the kind of unfair state support that has led to dumping investigations in both the US and European Union.
E-Commerce: Big Spenders Keep Spending 大型电子商务企业继续挥金如土
News from e-commerce giant Suning (Shenzhen: 002024) and web portal Phoenix New Media (NYSE: FENG) indicate a long-awaited consolidation in e-commerce has begun at the bottom of the Internet food chain, where many smaller players are quietly closing up shop as big names continue their aggressive fight for market share.
News Digest: August 14, 2012 报摘： 2012年8月14日
The following press releases and media reports about Chinese companies were carried on August 14. To view a full article or story, click on the link next to the headline.
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- Focus Media (Nasda: FMCN) Gets Management-Led $3.66 Bln buyout Offer (English article)
- Canadian Solar (Nasdaq: CIQ) Gets C$93 Mln Loan From China Development Bank (PRNewswire)
- Phoenix New Media (NYSE: FENG) Reports Q2 Unaudited Financial Results (PRNewswire)
- Wuxi PharmaTech (NYSE: WX) Announces Q2 Results (PRNewswire)
- Suning (Shenzhen: 002024) In 8 Bln Yuan Bond Offer as Website Consumes Cash (Chinese article)
- Latest calendar for Q2 earnings reports (Earnings calendar)
Dianping’s New Funding: M&A in Sight? 大众点评融资意在收购
It’s Monday morning and the news flow from the weekend is rather slow due to the summer holidays, so I’m going to be a bit whimsical and comment on the potential for new M&A following a new $60 million funding round for Dianping, an interesting and profitable company which started as a restaurant ratings company but which has also expanded into the problem-plagued group buying space. I’ll start by saying I have absolutely no reason to think Dianping has plans for any major M&A, but then will quickly add that its recent receipt of the $60 million in new venture funding looks suspiciously like it might be intended for such a purchase.
US Partners Flee Troubled ZTE 中兴遇美国顾问卸任
A key US consultant has severed his ties with troubled telecoms equipment and cellphone maker ZTE (HKEx: 763; Shenzhen: 000063), in a worrisome development that could presage more similar defections as people seek to distance themselves from the controversial company. ZTE and crosstown rival Huawei were already facing a difficult time in the US and Europe for several trade- and security-related reasons, but ZTE’s outlook grew dimmer still last month when word got out that the company was being investigated for allegedly selling banned US computer equipment to Iran to help that country set up a sophisticated telecoms surveillance system.
VanceInfo, HiSoft Set Stage for M&A Wave 文思信息和海辉软件奠定并购潮基础
A new mega-merger between China’s two largest software outsourcing firms could lay the foundation for a new global powerhouse in the lucrative IT services sector, marking the second major corporate marriage in China this year between two industry leaders. More of these kinds of marriages are sorely needed to clean up fragmented high-tech sectors marred by rampant competition, but to make that happen many of China’s most vibrant entrepreneurial companies need to lose their mom-and-pop shop mentality and learn to act more like the major corporations they aspire to become.
News Digest: August 11-13, 2012 报摘： 2012年8月11-13日
The following press releases and media reports about Chinese companies were carried on August 11-13. To view a full article or story, click on the link next to the headline.
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- VanceInfo (NYSE: VIT), HiSoft (Nasdaq: HSFT) to Combine in Merger of Equals (PRNewswire)
- Xiaomi Mialiao Acquires MSNLite Team to Take on Tencent’s (HKEx: 700) Weixin (Chinese article)
- Dianping Lands USD 60 Mln in Fourth-Round Funding (English article)
- US Lobbyist Severs Ties With Chinese Telecom ZTE (HKEx: 763) (English article)
- Number of Delisting US-Traded China Stocks Reaches 23 Over Past Year (Chinese article)
- Latest calendar for Q2 earnings reports (Earnings calendar)
Suntech: A Company in Free-Fall 尚德电力陷入死亡漩涡
Solar pioneer Suntech (NYSE: STP) was all smiles earlier this week when it announced an important sales milestone in North America, even as its outlook continued to dim amid a major fraud case that has spawned a new class action lawsuit against the company. (lawsuit announcement) Before I get to the latest details in this case, I want to step back quickly and look at the bigger picture, which is this: Suntech looks like a company on the cusp of falling off a cliff, potentially setting the stage for an acquisition by one of its rivals or even a potential bankruptcy.
Hotels: Stability and Indigestion at the Inn 中国经济放缓未损及经济型酒店稳定运营
I don’t know if it’s coincidence, but China’s top 3 US-listed hotel operators have all released their latest quarterly results on the same day, revealing a range of issues with a broader theme that points to stability in the industry despite China’s rapidly softening economy. The results from Home Inns (Nasdaq: HMIN), China Lodging Group (Nasdaq: HTHT) and 7 Days Group (NYSE: SVN) all tell slightly different stories, as each chain faces its own different issues. Based on my quick read, China Lodging seems to look the best right now, while Home Inns struggles with its recent mega-acquisition of Motel 168 and 7 Days faces operational issues.
News Digest: August 10, 2012 报摘： 2012年8月10日
The following press releases and media reports about Chinese companies were carried on August 9. To view a full article or story, click on the link next to the headline.
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- Online Price Wars to Wrap Up Soon: Dangdang (NYSE: DANG) CEO (Chinese article)
- 7 Days Group (NYSE: SVN) Announces Unaudited Q2 Financial Results (PRNewswire)
- China Lodging Group (Nasdaq: HTHT) Reports Q2 Financial Results (Globe Newswire)
- Bernstein Liebhard Announces Securities Class Action Against Suntech (NYSE: STP) (PRNewswire)
- China to Subsidies Appliances to Lift Consumption (English article)
- Latest calendar for Q2 earnings reports (Earnings calendar)
