The following press releases and news reports about China companies were carried on April 15. To view a full article or story, click on the link next to the headline.
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McDonald’s (NYSE: MCD) Targeting Buyout Firms As It Seeks to Sell North Asia Stores (English article)
Google (Nasdaq: GOOG) in New China Move with Event for Entrepreneurs (Chinese article)
Okmetic (Helsinki: OKM1V) Board Recommends National Silicon Industry Group Offer (GlobeNewswire)
Focus Media (Shenzhen: 002027) to Raise 5 Bln Yuan in Share Issue After Backdoor Listing
US Says China to Scrap Some Export Subsidies (English article)
Bottom line: Unigroup’s cautious approach to the potential acquisition of a small US chip maker reflects political realities that make larger purchases difficult, dealing a setback to China’s dreams of quickly building a chip-making giant.
Unigroup buys into Lattice Semiconductor
After being rebuffed several times in the US and Taiwan, China’s ambitious Tsinghua Unigroup is back in the chip acquisition headlines with word that it’s exploring a possible purchase of smaller US chip designer Lattice Semiconductor (Nasdaq: LSCC). Unlike the earlier failed deals that were either outright acquisitions or purchases of major stakes worth billions of dollars, this latest deal is quite small both in dollar terms and stake size.
That would seem to indicate that Unigroup and its affiliated sister companies, all housed at the prestigious Tsinghua University, are shifting to a more cautious approach targeting smaller companies in their global M&A strategy. We saw a similar move earlier this month, when a Shanghai-based government-backed buyer bid for Okmetic (Helsinki: OKM1V), a Finnish chip design house with a market value of about $200 million. (previous post) Read Full Post…
Bottom line: Baidu’s new reorganization is further evidence that the company plans to spin off its newer, money-losing units into separate companies, which could list on China’s OTC-style New Third Board later this year.
Baidu reorganizes
Online search leader Baidu (Nasdaq: BIDU) is in a couple of big headlines as it reportedly prepares to spin off some of its non-core businesses, led by word of a major reorganization that could help facilitate such spin-offs. A separate headline says that Baidu is also in talks for a $1 billion syndicated loan, in a move that is mostly market driven but also aims at getting fresh money to continue funding many of its loss-making newer businesses.
Baidu came under fire last year for its sluggish profit growth, as founder Robin Li insisted he would continue to invest heavily in his company’s loss-making businesses like its Nuomi group buying site and Qunar(Nasdaq: QUNR) online travel agency. Investors punished Baidu’s stock as a result, leading to reports earlier this year that Baidu was planning to spin off many of those businesses into separately listed companies. Read Full Post…
Bottom line: Jin Jiang is likely to ultimately drop its pursuit of Accor and sell its entire stake in the French hotelier, which is showing signs of growing uneasiness in an unwanted courtship by its Chinese suitor.
Jin Jiang contemplates upping its Accor stake
Leading Chinese hotelier Jin Jiang (HKEx: 2006; Shanghai: 600754) and worldwide peer Accor (Paris: AC) are becoming increasingly uncomfortable bed mates, with word that the former may want to boost its stake in the latter. This particular alliance was engineered by the state-run Jin Jiang, which early this year acquired 5.5 percent of Accor by purchasing shares of the French hotel operator in the open market. Jin Jiang later upped that stake to nearly 12 percent, though again it’s not clear if it bought the shares with the approval of Accor, operator of the upscale Novotel and Sofitel brands.
The history of this relationship, combined with overtones in the latest reports, all hint at an uneasy courtship that is taking place between these 2 companies. Jin Jiang is clearly interested in Accor’s global background and expertise, as it embarks on a recent buying spree in an attempt to build China’s first worldwide hotel company. But Accor seems far less interested in being pursued by Jin Jiang, probably because its suitor is an unfamiliar company with very little experience running a global brand. Read Full Post…
The following press releases and news reports about China companies were carried on April 14. To view a full article or story, click on the link next to the headline.
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Bottom line: Shanda’s purchase of a major stake in Legg Mason marks the start of a global investment spree that is likely to see 2-3 similar sized deals in the Chinese and global financial services sectors by the end of this year.
Chen Tianqiao kicks off Shanda global buying with Legg Mason stake
With its former online entertainment empire now firmly in the past, Shanda Group looks set to embark on the next chapter of its development as a private equity investor in the financial services sector. The first major step in that campaign is in the headlines today, with US asset manager Legg Mason (NYSE: LM) announcing that Shanda has just purchased 10 percent of the company.
The purchase looks like a small first step for Shanda onto the global stage in its new carnation. The company was formerly a Shanghai-based group founded by the financially savvy Chen Tianqiao, who was an early pioneer in China’s online game industry. But poor management and a series of unlucky developments led Shanda to lose its early lead in the space, and Chen has spent much of the last 3 years selling off his various entertainment assets. Read Full Post…
Just a day after fast-growing car services firm UCar confirmed a major new tie-up with e-commerce giant Alibaba (NYSE: BABA), we’re getting more details about the new alliance that appears to auger an end to Alibaba’s previous relationship with homegrown Uber rival Didi Kuaidi. At the same time, Alibaba has just announced its largest overseas purchase ever by paying $1 billion for a controlling stake of Southeast Asian e-commerce specialist Lazada.
These 2 news items continue a recent acceleration in M&A activity for the hyperactive Alibaba, which is quite in line with the hyperactive nature of its founder and chief pilot Jack Ma. This kind of cyclical hyperactivity has become the norm for Alibaba in recent years. It typically sees the company’s high-profile activity go into overdrive for a year or so, only to come to a sudden halt when things become overheated and problems emerge. Read Full Post…
The following press releases and news reports about China companies were carried on April 13. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Buys Control of Lazada in $1 Bln Bet on SE Asia E-commerce (English article)
Shanda Group Makes Long Term Strategic Investment In Legg Mason (NYSE: LM) (PRNewswire)
Private Chinese Firm Sharing Mobile in Deal to Buy Nigerian Telco GiCell (Chinese article)
China Hotelier Jin Jiang (HKEx: 2006) Said to Weigh Boosting Accor (Paris: AC) Stake (English article)
Car Services Firm UCar secures $569 Mln, Files for Listing on New Third Board (English article)
Bottom line: Alibaba’s new tie-up with Car Inc hints at a looming divorce with Didi Kuaidi, while a major new funding for its Koubei unit foreshadows a major new push that will further heat up intense competition in take-out delivery services.
Koubei seeks big new funding
Just days after reports emerged of a massive new funding for its Ant Financial unit, e-commerce leader Alibaba (NYSE: BABA) is back in the fund-raising headlines with big plans for its Koubei take-out dining unit. At the same time, an intriguing new story about a strategic Alibaba alliance with an aggressive new player in the hired car services space hints that the company may also be contemplating a divorce with national leader Didi Kuaidi.
Both of these stories reflect the catch-up game that Alibaba is playing in two important growth areas of the Internet. Alibaba previously had a presence in both through investments in hired car service provider Kuaidi and group buying site Meituan. But both of those partners entered mega-mergers over the last 6 months with their major rivals. As a result, Alibaba has divorced itself from the current Meituan Dianping, and is looking to build up its own rival Koubei take-out dining service. (previous post) Read Full Post…
Bottom line: The naming of a technocrat as chairman of China Telecom ends speculation of an industry shake-up, and indicates China’s big 3 telcos will continue as big state-owned companies that lag their global peers.
Beijing continues old ways with new China Telecom chief
It’s been quite a few months since I last wrote about China’s 3 big telcos, so the naming of a new chairman of China Telecom (HKEx: 728; NYSE: CHA) seems like a good chance to revisit this lifeless trio that were a hot topic last year due to rumors of an industry shakeup. The naming of a new technocrat as head of the carrier implies that it’s business-as-usual at China Telecom and for the broader trio of state-run caarriers, and that a shake-up that many of us were hoping for isn’t coming.
The new chairman, Yang Jie, will assume the helm of China Telecom 4 months after his predecessor, Chang Xiaobing, abruptly stepped down last year due to a corruption probe against him. Chang himself was previously chairman of China Telecom rival China Unicom (HKEx: 763; NYSE: CHU), but switched places with China Telecom’s chief Wang Xiaochu in the middle of last year in a characteristic bureaucratic reshuffling by Beijing. Read Full Post…
These past few weeks have been tinged with sadness and some melancholy for me, as 2 close friends on the streets of Shanghai quietly shuttered their doors forever. The pair both came from the family of traditional media, whose slow death is taking a quieter toll on the hundreds of newsstands that have become a fixture on Shanghai’s streets over the last 2 decades.
The creeping demise of these newsstands has been happening for the last 2 or 3 years now, but the closure of 2 familiar stops in my daily routine so close together made it feel like the trend is accelerating. I pass around a dozen such newsstands every day in my old neighborhood in Hongkou District, and probably about half of those are now permanently shuttered. Read Full Post…
