Bottom line: Fresh food sellers Yiguo and FruitDay could see strong growth and go public in the next 2-3 years, banking on strong partnerships with Alibaba and JD.com and growing consumer willingness to buy groceries online.
Yiguo in big new funding
Fresh fruit and other grocery items are the latest hot ticket in China e-commerce, with 2 up-and-coming players receiving big new fundings of $100 million or more. The larger of the pair has e-commerce leader Alibaba (NYSE: BABA) and global private equity giant KKR helping online fresh food seller Yiguo raise about $260 million in new money. The other has an online fruit specialist called FruitDay, whose backers include Alibaba arch-rival JD.com (Nasdaq: JD), raising its own $100 million.
This particular trend is really a sub-trend of a broader movement by China’s e-commerce giants into the grocery business over the last few years, encroaching on traditional supermarkets and also Wal-Mart’s (NYSE: WMT) Yihaodian that found early success in the space. Even Amazon (Nasdaq: AMZN) China has gotten into the business, though many of these companies specialize in more traditional packaged foods rather than fresh products. Read Full Post…
Bottom line: New $200-$300 million investments by Baidu and Alibaba in smaller Internet companies show such fundings are starting to recede in size after peaking earlier this year.
58 Home gets investment from Alibaba, KKR
Two big fund-raising stories are in the headlines today, each involving a top Internet company as China’s “big 3” trio of Baidu (Nasdaq: BIDU), Alibaba (NYSE: BABA) and Tencent (HKEx: 700) look for ways to put their big cash pots to work. It’s interesting to note that neither Baidu nor Alibaba is the central player in either of these latest deals, one in e-commerce and the other in online-to-offline (O2O) services. Instead, both are playing secondary roles, supporting other companies with good growth potential.
The larger of the 2 investments is seeing Alibaba participate in a new $300 million first funding round for a 1-year-old company that helps web surfers find home-based services like cleaning and baby sitting. The second has Baidu participating in a $200 million funding for an older e-commerce company with close ties to state-run cereals giant COFCO. Read Full Post…
Just weeks after a group of seasoned managers launched a major new fund in Shanghai, word is out that another top money manager is preparing to launch yet another fund aimed at selling China companies to global investors. The man behind the latest fund-raising drive is Yu Bin, a former director from China Investment Corp (CIC), China’s sovereign wealth fund. Yu is part of a new generation of market-savvy Chinese fund managers to emerge over the last decade, often after returning from the west where they received both education and experience working for major global fund houses and investment banks. Read Full Post…
China’s campaign to clean up its fragmented and scandal-plagued food industry has gotten a boost on the meat front, with word of a new tie-up between national grains giant COFCO and global private equity giants KKR and Baring Private Equity Asia. This latest move is part of Beijing’s growing effort to bring in foreign expertise to create a handful of major food groups that can ensure product quality and food safety. Unfortunately, nearly all the major giants now emerging are big state-run companies, meaning most of these firms are likely to be quite bureaucratic and most won’t be available to foreign stock buyers. Read Full Post…
The following press releases and media reports about Chinese companies were carried on June 7-9. To view a full article or story, click on the link next to the headline.
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COFCO Meat Brings in KKR, Baring PE, HOPU, Boyu as Strategic Investors (Businesswire)
China Mobile (HKEx: 941) Rolls Out Own-Brand 4G Phone Selling For 999 Yuan (Chinese article)
Apple (Nasdaq: AAPL) Steps Up Campaign To Woo China Developers (English article)
Xiaomi China Sales Surpass Apple (Nasdaq: AAPL) In Q1 (Chinese article)
Trina Solar (NYSE: TSL) Announces Pricing Of Offering Of 8.8 Mln ADSs (PRNewswire)
The following press releases and media reports about Chinese companies were carried on December 21-23. To view a full article or story, click on the link next to the headline.
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China Mobile To Launch iPhone On 4G & 3G Networks on January 17 (PRNewswire)
Everbright Bank (HKEx: 6818) Slides In HK debut Amid China Cash Crunch Fears (English article)
Alibaba Slashes Cloud Computing Prices Up to 50 Pct (English article)
Cofco Becomes Second Largest Stakeholder In Spirits Maker Guizhou Xijiu (Chinese article)
Linktone (Nasdaq: LTON) To Reduce Costs Through Voluntary Delisting (PRNewswire)
Ctrip (Nasdaq: CTRP) Leads Over $100 Mln Investment In eHi Auto Services (PRNewswire)
After 2 previous failed attempts to tap the China market, French food giant Danone (Paris: DANO) is trying yet again through a new major tie-up that includes a joint venture and equity stake in tainted dairy giant Mengniu (HKEx: 2319). This time I have to commend Danone on its choice of partners and approach in the new tie-up, which seem to show it’s learned its lesson from previous disastrous partnerships with 2 other locally controlled entities. Accordingly, the third time could finally be the charm for Danone as it looks for a success in the huge but often problematic Chinese food market. Read Full Post…
