It’s refreshing to see Lenovo’s (HKEx: 992) chatty CEO Yang Yuanqing finally doing something besides boasting about his big plans for the company, with word that he is donating a big chunk of his annual bonus to ordinary employees. I’m a bit too jaded to believe that Yang’s donation of $3 million is a purely selfless act, since he was quite willing to give the media a detailed account of his decision. Still, the latest news comes as a nice break from the usual chatter about new M&A targets and other global aspirations from one of China’s most successful tech firms. Read Full Post…
Most of the world is buzzing with speculation about what prompted a top Google (Nasdaq: GOOG) executive to defect to Chinese smartphone maker Xiaomi, but few are giving much credit to one of China’s hottest tech companies for luring Hugo Barra to join its ranks. Most media are focusing instead on an apparent love triangle between Google co-founder Sergey Brin and an unnamed current love interest, who just happens to be an ex-girlfriend of Barra. (English article) But instead, I would venture to guess that Barra’s departure has less to do with this titillating love story, and more to do with Xiaomi’s aggressive global aspirations, including its recent receipt of $2 billion in new funding — the most ever for a privately funded China tech firm. (previous post) Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 3. To view a full article or story, click on the link next to the headline.
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Rattled By Investigations, Foreign Firms In China Beef Up Compliance (English article)
Several solar panel companies are in the headlines once again, led by an news that bankrupt former superstar Suntech (NYSE: STP) is nearing a reorganization that will cost its stockholders most of their money. While that may sound bad, I personally don’t have much sympathy for anyone who continued to hold Suntech stock after the company started experiencing major problems about a year ago. Meantime, the news is a bit more positive for rivals Yingli (NYSE: YGE) and Renesola (NYSE: SOL), which both reported narrowing losses as outlook for the sector continues to improve with stabilizing and even rising prices for solar panels. Read Full Post…
China notched a major milestone in its fight against economic crime last week when it levied a record fine against a rogue securities brokerage and significantly raised the maximum penalty for trademark infringement. Both cases showed that Beijing is determined to significantly raise the penalties that companies and their employees face for economic crimes like trademark theft and insider trading. Read Full Post…
Three years. That figure has suddenly become the magic number for a growing number of private Chinese firms that are increasingly looking to make IPOs in Hong Kong, which requires that all companies show at least 3 consecutive years of profit before they can list there. That magic number appears to be the key element behind new remarks by leading car rental firm China Auto Rental, which says it favors a Hong Kong listing within the next 3 years over New York. Not surprisingly, the company’s chief executive Charles Lu said he expects China Auto to turn profitable this year, meaning 2016 is the earliest his company could qualify for a listing on Hong Kong’s main stock exchange. Read Full Post…
WeChat scores a hit in HK, Taiwan but could face resistance in US
I’ve been traveling through Hong Kong, Taiwan and Macau these last few days, so thought I’d end the week with a look at Tencent’s (HKEx: 700) hugely popular WeChat mobile messaging service and the challenges it faces in its quest to go global and commercialize. I’ve been quite surprised by how widespread WeChat, known in Chinese as Weixin, has become in all 3 of these Chinese-speaking areas. But at the same time, comments from one of my industry friends also indicate Tencent could face an uphill battle winning acceptance in the US, where it could face heavy competition from rival products and skepticism due to its China connections. New media reports also indicate WeChat’s hyped new relationship with China Merchants Bank (HKEx: 3968; Shanghai: 600036) may also be running into problems, indicating the road to commercialization may not be as smooth as Tencent had hoped. Read Full Post…
Just a couple of weeks after US delivery giant UPS (NYSE: UPS) unveiled a major plan to expand its China logistics infrastructure, private equity firm Carlyle is announcing an even larger $400 million venture to tap the nation’s booming e-commerce market. These 2 mega investments could well be followed by similar plans from both domestic and international firms, resulting in a multibillion-dollar spending spree over the next few years on new warehouses and other logistics facilities to help speed the delivery of goods ordered online to users’ homes and offices. Read Full Post…
A new report on the explosion of e-commerce in China seems like a good opportunity to take a broader look at the sector and its longer term potential, including which players are likely to emerge as the big winners over the longer term. The latest figures indicate the potential of e-commerce in China is huge, meaning we could ultimately see 2 or 3 major players succeed in the market. But that also means we’re likely to see at least 3 or 4 casualties in the current battle for supremacy, since the field of major, well-funded contenders current numbers around 6 or 7. Read Full Post…
I’m calling today “legal Thursday” following word of a series of shareholder lawsuits against state-run oil giant PetroChina (HKEx: 857; Shanghai: 601857; NYSE: PTR) and e-commerce firm LightInTheBox (NYSE: LITB), whose shares have both dropped sharply in the last 2 weeks. These lawsuits may just be the first in what’s likely to become a bigger wave of similar actions by law firms that will accuse the companies of hiding information that led to their share declines, costing investors millions of dollars. In particular, we could see a flood of similar share plunges and lawsuits at other major publicly listed state-run firms if Beijing continues its recent campaign to root out rampant corruption at many of these companies.
Perhaps struggling former global PC leader Hewlett-Packard (NYSE: HPQ) has finally straightened its house, or perhaps it senses that rival Lenovo (HKEx: 992) has become distracted with its recent push into smartphones. Whatever the reason, HP appears to be gearing up for a new push into China, with its announcement of a newly created China chairman position which is being filled with a tech industry veteran. Such a move implies an overhaul of HP’s China operations, and is certainly long overdue for a company whose share of China’s PC market has dropped sharply in the last few years. But the move also looks like too little too late, amid a global trend that has seen PC sales fall sharply due to the rising popularity of smaller devices like tablet PCs and smartphones. Read Full Post…
