Tag Archives: Haier

IPOs: No One Comes to Haier’s German Party

Bottom line:  Haier’s weak IPO under a new German program to internationalize Chinese stocks owes to lack of awareness and thin trading, and reflects challenges the new market will face in its drive for recognition.

Haier IPO party draws low interest

What if you threw an IPO and nobody came? That’s what seems to be happening for home appliance giant Haier, which has just made the inaugural listing on a new Sino-German stock exchange aimed at internationalizing Chinese companies. The program captured headlines earlier this year when it was first announced that Haier had been selected to make the inaugural listing. But momentum has rapidly faded since then.

I’ll examine some of the reasons for the lackluster debut shortly, and what it might mean for the internationalization of Chinese stocks, which appears to be the bigger goal with this program. But first let’s review this latest less-than-dazzling end to a story that began with relatively strong sentiment and big hopes. Read Full Post…

China News Digest: June 8, 2016

The following press releases and news reports about China companies were carried on June 8. To view a full article or story, click on the link next to the headline.
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  • iKang (Nasdaq: KANG) Receives Competing “Going Private” Proposal from Yunfeng (GlobeNewswire)
  • Parcel Delivery Firm Uni-Top Gets 15 Bln Yuan in New Investment (Chinese article)
  • Alibaba (NYSE: BABA) Chief Jack Ma Says Hopes Ant Financial to Make IPO in HK (Chinese article)
  • TSMC (Taipei: 2330) Chairman Welcomes China Investment, But No Board Seats (Chinese article)
  • Haier’s GE (NYSE: GE) Home Appliance Buy Nears Close, Final Price at $5.58 Bln (Chinese article)

MULTINATIONALS: Europe Joins US in China M&A Alarmism

Bottom line: Midea’s plan to buy 30 percent of German robotics maker Kuka is likely to collapse due to EU resistance, reflecting growing wariness towards China’s global buying spree of western technology.

EU official sounds alarm at Midea’s Kuka buy

Alarmism at China’s growing string of global M&A is spreading from the US to Europe, with growing signs of resistance to the recently announced purchase by Chinese company of a major stake in a leading German robotics firm. Two separate new headlines point to the nascent resistance against the landmark deal announced 2 weeks ago, which would see Chinese home appliance maker Midea (Shenzhen: 000333) acquire 30 percent of Germany’s Kuka (Frankfurt: KU2G) for more than $1 billion. (previous post) According to the latest reports, a top European Union (EU) industry official and one of Kuka’s largest shareholders are separately expressing reservations about the deal, in what almost looks like a coordinated effort to show the uneasiness some Europeans are feeling. Read Full Post…

CONSUMER: Midea Shopping Spree Moves to Germany

Bottom line: Midea should limit its new plan to buy a major stake in Germany’s Kuka to a strategic partnership, and avoid temptation to help Kuka lower costs by moving major parts of its manufacturing to China.

Midea eyes Germany’s Kuka

A recent overseas M&A binge by top Chinese home appliance makers is taking a somewhat unexpected turn, with word that Midea (Shenzhen: 000333) is pursuing a deal to buy a major stake or even outright purchase Germany’s Kuka (Frankfurt: KU2). In this case the deal comes as something of a surprise, since Kuka isn’t an appliance maker but instead manufactures industrial robots that Midea is using to modernize its production lines.

This particular deal could carry a price tag of more than $1 billion, and would come just 2 months after Midea’s smaller deal to purchase the home appliance business of scandal-tainted Japanese electronics giant Toshiba (Tokyo: 6502). (previous post) This latest deal is logical, though could also carry a large degree of risk due to previous poor results for Chinese companies that bought manufacturers in the tough French and German markets. Read Full Post…

CONSUMER: Midea Goes Appliance Shopping with Toshiba

Bottom line: Midea could buy another global brand following its purchase of Toshiba’s home appliance business, while hometown rival Gree will also feel pressure to make a small to mid-sized overseas acquisition in the next 1-2 years.

Midea in MOU for Toshiba’s appliance unit

Following several days of rumors, struggling Japanese tech giant Toshiba (Tokyo: 6502) has confirmed it will sell a controlling stake in its home appliance business to Midea (Shenzhen: 000333), extending a fledgling movement by Chinese buyers abroad. The move could pressure other Chinese rivals, most notably Gree (Shenzhen: 000651), to follow in the footsteps of Midea and Haier (HKEx: 1169), which is also in the process of buying General Electric’s (NYSE: GE) appliance business.

From a bigger perspective, this particular trend looks a bit like what happened several decades ago in the older industry for TV sets. That trend saw Asian buyers purchase big western brands in the fading TV industry, with storied names like Zenith and RCA ultimately get gobbled up. Fast forward to the present, when most of those older brands no longer exist or are insignificant, which could hint at what may lie ahead for these new purchases by the Chinese companies. Read Full Post…

CONSUMER: Midea Follows Haier Abroad with Toshiba Talks

Bottom line: Midea’s reported bid for Toshiba’s home appliance business reflects a renewed global push by Chinese white goods maker, but is likely to fail due to Midea’s lack of experience managing a global brand.

Midea eyeing Toshiba’s white goods?

Leading appliance maker Haier (HKEx: 1169) could quickly discover it’s not the only Chinese company roaming the globe for acquisitions, with word that domestic rival Midea (Shenzhen: 000333) is in talks to buy the white goods business of Japan’s Toshiba (Tokyo: Tokyo). This particular news comes as Haier finalizes its purchase of the home appliance unit of General Electric (NYSE: GE), and is part of a larger push by big western companies to sell their lower-margin white goods businesses.

A subset of that bigger story has seen Japanese brands engage in their own campaign to sell off assets from their lower margin businesses, many of which are losing money. That trend has culminated in prolonged talks that are likely to see the struggling Sharp Corp (Tokyo: 6753) sell itself to Taiwan’s Hon Hai (Taipei: 2317), in what would mark the largest-ever sale of a Japanese electronics company to a foreign buyer. Read Full Post…

News Digest: January 16-18, 2016

The following press releases and media reports about Chinese companies were carried on January 16-18. To view a full article or story, click on the link next to the headline.
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  • China’s Haier to Buy GE’s (NYSE: GE) Appliance Unit for $5.4 Bln (English article)
  • Huawei Says to Launch Notebook PCs in February with Intel (Nasdaq: INTC) (Chinese article)
  • Regulator Orders Removal of False Claims Posts on Baidu (Nasdaq: BIDU) Tieba Service (Chinese article)
  • Xiaomi Misses Smartphone Sales Target by 10 Pct on China Slowdown (English article)
  • JD.com (Nasdaq: JD) Finance Arm Raises 6.65 Bln Yuan, Valued at 46.7 Bln Yuan

INTERNET: Twitter Eyes China Ads, Weibo Eyes Car Services

Bottom line: Twitter’s growing pursuit of business from Chinese advertisers shows it is watching the market for a potential future entry, while a new equity tie-up could see Didi Kuaidi’s hired car services launch on Weibo later this year.

Twitter chases China advertisers

Social networking (SNS) pioneer Twitter (NYSE: TWTR) and its Chinese clone Weibo Corp (Nasdaq: WB) are both in the China headlines today, each taking gambles on different parts of the market. After previously saying that China isn’t a market where it can do business, the original Twitter has quietly begun to court local advertisers, even as its actual service remains blocked in the country. Meantime, Weibo, which rose to prominence after Twitter was first blocked in China in 2009, has announced a relatively large new investment in local hired car services leader Didi Kuaidi. Read Full Post…

MULTINATIONALS: Apple Watches China, Cools With Haier

Bottom line: Apple Watch should debut strongly in China thanks to extensive partnerships with top Chinese retailers and app makers, giving the product instant relevance in the local market.

Apple Watch coming to China

Global gadget leader Apple (Nasdaq: AAPL) has been in the local tech headlines nonstop these last few days, wowing Chinese fans with a customized version of its new Apple Watch that will debut in China next month as part of its global launch. Pundits are mixed on how the watch will fare in China, but I expect it should do quite well thanks to inclusion of China’s hottest apps together with the company’s own strong reputation for well-designed, cutting-edge products.

In a separate but probably related Apple headline, media are also reporting a new smart air conditioner that the company has developed with local appliance leader Haier (HKEx: 1169) will also debut in April. Apple first announced this alliance last June as part of a broader smart device alliance under the  name of HomeKit, and I suspect the Apple Watch will be usable with these new air conditioners. Read Full Post…

News Digest: March 11, 2015

The following press releases and media reports about Chinese companies were carried on March 11. To view a full article or story, click on the link next to the headline.
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  • EU Accuses 3 Chinese Firms Of Non-Compliance With Solar Panel Agreement (Chinese article)
  • P&G (NYSE: PG) Fined 6 Mln Yuan Over Crest’s Teeth-Whitening Ads (English article)
  • Sina (Nasdaq: SINA) Reports Q4 2014 Financial Results (PRNewswire)
  • Haier Says First HomeKit Air Con With Apple (Nasdaq: AAPL) To Debut In April (Chinese article)
  • Apple (Nasdaq: AAPL) Watch Not Yet Setting Chinese Pulses Racing (English article)
  • Latest calendar for Q4 earnings reports (Earnings calendar)

CONSUMER: Haier, Midea Crank Up Smart Device Dance

Bottom line: Chinese appliance makers and Internet companies need to focus their smart device efforts on one or two key alliances each, or risk spreading their resources too thin.

Haier in new tie-up with Evergrande

Smart devices look set to become a theme of the New Year, with new reports that domestic appliance giants Haier (HKEx: 1169) and Midea (Shenzhen: 000333) have formed major new tie-ups to develop the space. Similar alliances began accelerating in the second half of last year and are aimed at developing the “Internet of Things”, which envisions an interconnected world where devices and their owners can talk to each other at any time over a wide range of wired and wireless networks. Read Full Post…