Bright Dairy (Shanghai: 600597) and Mengniu (HKEx: 2319) are rapidly emerging as China’s 2 dairy firms to watch as Beijing encourages consolidation in the scandal-plagued sector in a bid to create a handful of giants that can win back consumer confidence. Both companies have been in a steady stream of headlines over the last 2 days, showcasing their growing clout not only at home but also on the world stage. Bright is making news as it nears a deal to take a big stake in Israeli dairy Tnuva, and also as it receives big new funding from a global investor. Meantime, Mengniu is also making headlines as it boosts its growing ties with French giant Danone (Paris: DANO), and as its shares mark an important milestone on the Hong Kong stock exchange. Read Full Post…
China was closed for much of last week, but that didn’t some of its top tech executives from emitting a steady stream of tweets on their microblogs regaling followers with tales of their travels over the Lunar New Year holiday. The US emerged as the travel destination of choice for many who favored a destination that has been quite generous towards their sector over the last few months.
Regular tech readers will know I’m talking about the huge success of 5 major Chinese Internet IPOs in New York, many of which have nearly doubled in value since their trading debuts in the last 2 months of 2013. Executives at JD.com, China’s second largest e-commerce company, are hoping to ride that wave of positive sentiment with another New York IPO this year. That pending deal saw one JD.com executive complain of having to take part in a late-night teleconference during the Lunar New Year holiday that I suspect was connected to that upcoming listing. Read Full Post…
Two of China’s biggest Internet names are making interesting new moves into the tough US market, with word that Alibaba has launched an American e-commerce website and Baidu (Nasdaq: BIDU) founder Robin Li is helming a major new Hollywood animation studio. Both moves look cautious but relatively well conceived, even though each carries a degree of risk due to intense competition in the US e-commerce and animation sectors. Still, I have to admire both companies for at least trying, even if their chances of success could be around 50-50. Read Full Post…
China’s telecoms regulator has made steady moves in the last 2 months to usher in a new era of competition for the nation’s telecoms services sector by breaking the long-running monopoly held by 3 big state-run carriers. The strategy, which will see several dozen new virtual network operators (VNOs) enter the space, is a welcome development and could help China compete with other nations in the future development of cutting-edge telecoms services. Read Full Post…
Barely a week into the Lunar New Year, word of 2 new investments by Alibaba shows that China’s leading e-commerce firm has no intent of slowing its recent buying binge as it marches towards its highly anticipated IPO. The far bigger of the 2 deals would see Alibaba purchase 72 percent of digital mapping company AutoNavi (Nasdaq: AMAP) for $1.6 billion, giving it full ownership after Alibaba bought 28 percent of the company last year. Meantime, media are also reporting that Alibaba and venture capital firm IDG have invested a more modest sum of about $25 million in Inman, an online clothing brand that sells over Alibaba’s popular online shopping malls. Read Full Post…
Despite all my warnings, car maker Dongfeng (HKEx: 489) is moving ahead with a plan to invest in struggling French rival Peugeot (Paris: PEUP) as part of a drive to reduce dependence on its current Japanese partners. Dongfeng’s newest tie-up will cement a growing alliance with the French, since this new investment would come just months after Dongfeng inked a separate joint venture deal with that country’s Reneault (Paris: RENA) after more than a year of talks. While France and Japan are completely different animals, each will pose significant challenges for Dongfeng, which is quickly emerging as China’s least politically savvy car maker in its choice of foreign partners. Read Full Post…
This year I decided to formally end my 23-year-old informal ban on trips to the countryside during the Spring Festival holiday, and went to visit friends in 2 small Anhui towns to see what’s changed over all that time. What I found was an interesting hodgepodge of the old and the new, with many traditions still alive and well even as some get nudged out by encroaching modernization. Read Full Post…
Telecoms history looks set to repeat itself, with word that a Chinese investor is in talks to buy the office telecoms business of struggling French networking equipment maker Alcatel-Lucent (Paris: ALU). On the one hand, I have to congratulate Alcatel for getting any money at all for the unit, which I suspect is either losing money or perhaps is marginally profitable. On the other hand, I honestly don’t understand why Chinese investment firm Huaxin Post & Telecommunication could possibly want this business, following a disastrous track record for similar European acquisitions by Chinese firms. Read Full Post…
Lenovo shares to come under pressure for next 2 years
Media have been buzzing these last few days about a Hong Kong stock exchange filing revealing that Google (Nasdaq: GOOG) has acquired 6 percent of Chinese PC giant Lenovo (HKEx: 992), implying the deal represents a vote of confidence by the world’s biggest Internet company in the world’s top PC seller. But anyone with any memory will recall that the transaction is just part of Lenovo’s payment for its recent purchase of Google’s Motorola cellphone division. What’s more, Google is almost certain to dump the stock once a lock-up period ends, putting pressure on Lenovo’s stock until that date arrives. Read Full Post…
Things have certainly changed over the last 3 years in Lunar New Year messaging, as reflected by the flood of tech executives using their microblogs to weigh in on Tencent’s (HKEx: 700) launch of a red envelope gift function for its popular WeChat platform over the holiday period. Most of the comments were admiring and even in a slight state of awe at the big success of WeChat’s hongbao product, which lets users send gift money to their friends and relatives over the popular instant messaging platform. But at least one post from Alibaba smelled of sour grapes, and a Sina (Nasdaq: SINA) executive also took a backhanded swipe at the rival to his company’s own Weibo microblogging service. Read Full Post…
Two US high-flyers that have relied heavily on the China story to fuel their growth are suddenly going into proactive mode, with KFC’s parent Yum (NYSE: YUM) and personal care products maker Herbalife (NYSE: HLF) both taking new steps to avoid repeats of previous recent disasters. In the former case, Yum has said that so far it sees no signs of declining business at its China KFC stores as we head into the height of the current bird flu season. Meantime, Herbalife is trumpeting its receipt of a quality designation for its products in Taiwan, as it seeks to avoid repeating a disaster at rival Nu Skin (NYSE: NUS) in China last month. Read Full Post…
