Bottom line: A new marriage between Midea and Kuka may get off to a rocky start due to cultural differences, but could ultimately do well and see the formation of a joint venture to sell industrial robots in China.
Midea and Kuka tie the knot
After a tense 2 months, a controversial tie-up between Chinese home appliance maker Midea (Shenzhen: 000333) and German robotics firm Kuka (Frankfurt: KU2) has just taken a major step forward, with the former sharply boosting its stake in the latter. Midea took the $1.3 billion step after providing numerous assurances to Berlin, including guarantees that it didn’t plan to relocate German jobs to China or take over Kuka’s management.
The step forward looks like a big victory for free trade, as it shows that governments like Germany won’t meddle in market-driven M&A and other cross-border tie-ups even when they involve cutting-edge technology. But this new cross-border marriage is just beginning, and I suspect there will be many bumps in the road ahead as this pair from very different cultural backgrounds gets to know each other. Read Full Post…
Bottom line: Fosun’s New York IPO plan for US insurer Ironshore could draw strong interest due to Fosun’s China and global connections, and may ultimately raise up to $1 billion later this year.
Fosun eyes NY listing for Ironshore
China’s recent global buying spree has created some interesting investment opportunities, as Chinese acquirers increasingly look to western investors to help pay for their purchases. One such new opportunity is in the headlines this week, with word that Chinese private equity giant Fosun (HKEx: 656) is aiming to launch a New York IPO for its recently acquired US insurer Ironshore. In this growing trend, the Chinese investors are hoping to generate some buzz for this kind of IPO by taking regionally-focused assets and repositioning them as global plays, often with a big China focus. Read Full Post…
The following press releases and news reports about China companies were carried on July 6. To view a full article or story, click on the link next to the headline.
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Hon Hai (Taipei: 2317) Plans $1.5 Bln HK IPO for Foxconn Interconnect Technology Unit (English article)
The following press releases and news reports about China companies were carried on July 5. To view a full article or story, click on the link next to the headline.
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CICC (HKEx: 3908), China Investment Securities Said to Be in Merger Talks (English article)
Midea (Shenzhen: 000333) Buys Stake in Germany’s Kuka (Frankfurt: KU2) for $1.3 Bln (English article)
Fosun (HKEx: 656), Ant Financial in Strategic Partnership (Chinese article)
Kingsoft (HKEx: 3888) Makes $125 Mln H1 Provision for Losses at Xunlei, 21Vianet (HKEx announcement)
Baidu (Nasdaq: BIDU) Completes Literature Unit Sale to Perfect World, No Price Given (Chinese article)
Bottom line: A rumored Chinese purchase of 80 percent of AC Milan, together with a new Chinese soccer buy in Australia and NBA purchase in the US, show a recent Chinese buying spree of western sports teams continues to gain momentum.
China in 3 new foreign sports team investments
China’s roll into western sports teams continues, led by word that a Chinese group including Baidu’s (Nasdaq: BIDU) chief Robin Li is on the cusp of a deal to buy 80 percent of soccer club AC Milan for 750 million euros. But that group isn’t the only one making soccer headlines, as a Shenzhen businessman has also reportedly bought Australia’s Newcastle United Jets club. And my prediction that someone in China would make a bid for an NBA club in the US is also in the news, with word that a businessman from southern Fujian province has purchased a small stake in the Minnesota Timberwolves. Read Full Post…
Our subway system beneath the streets of Shanghai became just a tad quieter this week, with the official retirement of passes that have allowed elderly riders to use the metro for free for years. Regular users of our metro will know I’m referring to disappearance of the voice that barks out the words jinglaoka every time a user of one of these free passes enters or exits through the turnstiles of the subway.
That loud voice, presumably aimed at preventing abuse of the cards, officially went quiet this past Sunday, marking the end of an era for elderly people who could enjoy unlimited free rides during non-peak times. The new policy also eliminated free rides for retirees on our city’s bus system. Read Full Post…
Bottom line: AMC is likely to raise its offer for Carmike Cinemas to the $33-$35 range to placate investors who say the original bid price is too low.
AMC to delay Carmike bid vote
Just days after meeting resistance in a bid to privatize his Hong Kong-listed real estate company, billionaire Wang Jianlin is running into similar difficulties in his plans for a similar buyout of US-listed movie theater operator Carmike Cinemas (Nasdaq: CKEC). Wang first bid for Carmike earlier this year, hoping to combine it with his previously purchased AMC Entertainment (NYSE: AMC), the second largest US movie chain operator. But shareholders quickly said the offer price was too low, and now it appears that Wanda and Wang are reconsidering the bid. Read Full Post…
Bottom line: Postal Savings Bank’s IPO is likely to get a moderately strong reception and come close to the upper end of its $10 billion target, while Yum China’s IPO is unlikely to come until the end of this year at earliest.
Yum China spin off plans hit delays
What’s likely to become the world’s biggest IPO in 2 years has just officially launched in Hong Kong, with word that China’s Postal Savings Bank has made its first filing for an offering that could raise up to $10 billion. Meantime, another high-profile IPO by the Chinese unit of fast-food giant Yum Brands (NYSE: YUM) is getting hit by delays, as operator of the KFC chain seeks key local backers in the run-up to a listing that could also come in Hong Kong. The Yum offering could also be quite large at around $2 billion, though it appears the deal may not come now until the end of this year or may even get pushed back to 2017. Read Full Post…
Bottom line: 21Vianet could get a new privatization offer from Tsinghua Unigroup by year end, following withdrawal of a previous bid; while Xiaomi chief Lei Jun may start selling non-core assets to raise money for his struggling company.
Buyout group scraps 21Vianet bid
Data center operator 21Vianet (Nasdaq: VNET) has finally done the inevitable and formally scrapped its de-listing plan, becoming the second company to do so among some 40 US-listed Chinese firms trying to privatize from New York. This particular move has been coming for a while now, and signs appeared as early as May that 21Vianet was abandoning its privatization plans. But new Chinese media reports are casting some light on why this particular bid collapsed, and it appears the reasons are linked to struggling smartphone maker Xiaomi, whose chief and co-founder Lei Jun was helping to finance the deal. Read Full Post…
Bottom line: Smartisan is likely to close or get sold by the end of this year, possibly to Meizu, while Xiaomi’s valuation is likely to fall by up to half when it returns to private investors for new funding with a year.
No near-term IPO for Xiaomi
A couple of fund-raising stories involving smartphone makers Smartisan and Xiaomi are in the headlines, reflecting in different ways the intense pressure each is feeling due to stiff competition that could soon claim a major victim. One headline has everyone buzzing over a recent share sale to raise cash by the founder of Smartisan, a highbrow niche brand set up by China’s most famous English teacher Luo Yonghao. The other has Xiaomi chief Lei Jun saying that his company may make an IPO in 2025, in what looks like a sarcastic response to a reporter’s question. Read Full Post…
Bottom line: Orient Securities IPO shares will debut flat due to weakness in China’s stock markets, CR Pharma will price stronger on good prospects for drug makers, and Wanda Commercial will have to raise its privatization buyout price.
CR Pharma files for HK IPO
After a quiet first half of the year, big IPOs for Chinese companies are suddenly coming to life in Hong Kong, though the outlook isn’t particularly strong. The latest headlines have China Resources Pharmaceutical filing for a $1 billion offering that was first mooted back in February, while the second has Oriental Securities pricing its own $1 billion offering near the bottom of its range. Meantime, a privatization bid for the Hong Kong-listed Wanda Commercial Properties (HKEx: 3699) has hit a stumbling block, with word that a major investor has objected that the buyout price is too low. Read Full Post…
