Bottom line: Ant Financial will counter bid for MoneyGram, following a surprise rival bid for the company, while Alibaba Pictures’ absorption of the former Youku Tudou looks like a logical consolidation of Alibaba’s filmed entertainment assets.
Ant’s MoneyGram offer attracts rival bidder
Two of Alibaba(NYSE: BABA) founder Jack Ma’s biggest endeavors outside his core e-commerce business are in the headlines, led by a counter bid for a US financial services company his Ant Financial is trying to acquire. That particular deal has a US company called Euronet Worldwide announcing a bid for MoneyGram that’s 15 percent higher than Ant’s own $880 million bid made back in January. The other news is slightly more mundane but still significant, and has Ma’s Alibaba moving its Youku Tudou online video service into its separately listed Alibaba Pictures (HKEx: 1060) filmed entertainment unit. Read Full Post…
Bottom line: This year is likely to see at least a half dozen privately owned financial services companies make public listings in the U.S., Hong Kong and China, with Lakala and Lufax likely to be among the first.
Lakala files for ChiNext IPO
We’re already three months into the new year, and still awaiting the first of what looks set to be a bumper crop of IPOs by a new generation of privately owned financial services firms that are far more dynamic than their state-run peers. Two more of those are in the headlines today, led by China Rapid Finance, a peer-to-peer (P2P) lender that says it’s eyeing a $100 million IPO in New York. At the same time, the popular Lakala electronic payments service has filed to make a listing on the Nasdaq-style ChiNext board in Shenzhen.
That pair are joining a few other notable names that are reportedly aiming to list in the not-too-distant future. That group includes Lufax, which bills itself as China’s largest P2P lender and is aiming to list in Hong Kong. Then there’s Qudian, a microlender that is looking to raise hundreds of millions of dollars with a New York listing. And of course, the granddaddy of them all is Ant Financial, which could raise more than $1 billion with a listing in Hong Kong or dual listing in Hong Kong and China. Read Full Post…
Bottom line: Starbucks’ selection of WeChat before Alipay for in-store electronic payments is a symbolic victory for the former, while Alipay’s aggressive global expansion could eventually help it to overtake UnionPay outside China.
WeChat ties with Starbucks
China’s two leading mobile payments services are both in the headlines, led by word of a major new tie-up between Tencent’s (HKEx: 700) WeChat and coffee lifestyle titan Starbucks (NYSE: SBUX). I have to admit that my interest in this particular tie-up is somewhat personal, as I’m a big fan of both of these companies and have been waiting a long time for such a partnership.
But equally significant is the fact that Starbucks chose WeChat before archrival Alipay. That same Alipay is in a couple of its own headlines, both showing how it’s trying to expand abroad to compete with China’s other major electronic payments system, the state-owned UnionPay. One of those headlines has Alipay in a new tie-up in Australia, while the other has it announcing partnerships with four major financial companies to expand its footprint in Europe. Read Full Post…
Bottom line: Microlender Qudian could raise $500 million or more in an IPO in the first half of next year, most likely in New York, and could get a modestly positive reception as one of the first in a new wave of private Chinese financial firms to list overseas.
Qudian hires CFO, investment bank
Growing signals are emerging that an offshore IPO could be coming soon for Qudian, a financial firm that began its life as a microlender named Qufenqi helping college students to buy things like computers and smartphones. That’s my assessment after learning from one of my sources that Qudian has hired a foreign-trained CFO and also an investment bank, typical developments for a company that wants to make an offshore listing within the next year and often even sooner.
From an investor’s perspective, the company would offer an interesting private play into China’s financial sector, albeit a relatively niche part of that sector. Investors can already buy into numerous Chinese banks and other financial institutions like brokerages and asset managers. But most of those are state-owned and make many of their decisions based on government directives, with the result that their decisions often have a heavy political element that doesn’t always make commercial sense. Read Full Post…
Bottom line: NetEase could abandon a newly announced New York IPO plan for its media arm if it can find a suitable buyer, while a previously announced New York listing plan by ZTO Express could be revived before year-end.
NetEase news unit makes filing for NY IPO
What’s shaping up as a quiet year for Chinese IPOs in New York has just gotten a small boost, with word that online gaming giant NetEase (NYSE: NTES) has made an initial filing to list its respected but financially-challenged news portal business. Meantime, rumors are building for what’s likely to be one of next year’s biggest offerings from Ant Financial, the financial services affiliate of e-commerce giant Alibaba(NYSE: BABA) and owner of the Alipay e-payments service. But in this case, Ant is shooting down the latest buzz that specific plans are in place for a Hong Kong IPO next year. Read Full Post…
Bottom line: Yum’s selection of Primavera and Ant Financial to anchor its China unit spin-off look like reasonable choices, as it tries to put the business back on solid footing before a New York IPO that should enjoy modest success.
Yum China sells stake to Primavera, Ant
After months of talks and speculation, fast food giant Yum Brands (NYSE: YUM) has announced that two firms with distinctly financial backgrounds will anchor its plan to spin off its China business. The larger of the investors, private equity firm Primavera, doesn’t look extremely exciting strategically, as it’s mostly a private equity investor with little experience in the tough retail sector. The second investor, Alibaba’s (NYSE: BABA) Ant Financial affiliate, looks a little more interesting since its core Alipay electronic payments service could help to propel Yum’s aging KFC and Pizza Hut brands into the modern era. Read Full Post…
Bottom line: New global initiatives by Alibaba’s cloud and electronic payments affiliates look smart by targeting Chinese customers abroad, but may only stand a 50-50 chance of longer-term success due to fierce global competition.
AliCloud global expansion moves ahead
Following lackluster results for initiatives involving its core e-commerce business outside China, Alibaba (NYSE: BABA) is pushing ahead on the global stage with new moves for 2 of its other areas with big growth potential. One of those has the company unveiling a global strategy for its cloud services unit, AliCloud, which includes a tie-up with former Taiwan smartphone superstar HTC (Taipei: 2498). The other involves Alibaba’s Ant Financial affiliate, which is rolling out its core Alipay electronic payments service in Europe. Read Full Post…
The following press releases and news reports about China companies were carried on August 11. To view a full article or story, click on the link next to the headline.
══════════════════════════════════════════════
LeEco (Shenzhen: 300104) Invests 20 Bln Yuan on Zhejiang Car Factory (Chinese article)
Bottom line: Alibaba’s bid for Polish C2C site Allegro looks like a smart move into a related developing market, but could be thwarted by rival Tencent, while affiliate Ant Financial’s new Taiwan insurance tie-up also looks smart though relatively small.
Alibaba bids for Poland’s Allegro
E-commerce giant Alibaba (NYSE: BABA) and its Ant Financial affiliate are in a couple of major headlines as the weekend approaches, each focusing on a strategic growth area. In the first case, Alibaba has entered the bidding for a leading Eastern Europe online auctions site, competing with global rival eBay (Nasdaq: EBAY) for Poland’s Allegro. The second deal has Ant, owner of leading electronic payments service Alipay, expanding its financial services holdings with the purchase of a majority stake in the insurance unit of Taiwan’s Cathay Financial (Taipei: 2882). Read Full Post…
Bottom line: Baidu could suffer more lost business after purging stealth advertisers engaged in gambling and sex services, while its new credit-scoring tie-up looks like a smart way to take advantage of its huge volumes of user data.
Baidu purges search results of online gambling sites
A day after appearing in 2 major global entertainment stories, online search leader Baidu (Nasdaq: BIDU) is back in the headlines at home in a new scandal involving online gambling sites that used stealth methods to promote themselves on Baidu’s search service. Normally I would say this particular scandal looks relatively minor and wouldn’t have a major impact on Baidu. But such scandals have suddenly become much bigger news following one back in May, which was centered on Baidu’s longtime practice of combining paid search results with organic ones without disclosing that mixture. Read Full Post…
Bottom line: China Logistics’ IPO could rise 5-10 percent in its trading debut, while AirAsia could list in Hong Kong by year end and online lender Qufenqi could follow with an IPO in the first half of 2017.
AirAsia Eyes Second listing in HK
Hong Kong IPOs continue to heat up as we head into the heart of summer, with word of a major new listing from China Logistics Property and reports that budget carrier AirAsia may also be eyeing an offering in the market. Meantime, Qufenqi, the hot online lender that targets students, has just raised a hefty 3 billion yuan ($450 million) in new funding, in a prelude to what could become one of next year’s hottest IPOs. All of this comes against the backdrop of a looming mega offering by China’s Postal Savings Bank, whose $8 billion fund-raising target would make it the world’s biggest IPO since Alibaba’s (NYSE: BABA) blockbuster $25 billion offering 2 years ago. Read Full Post…
