Bottom line: A Chinese group’s plan to buy the low-end chip business of Dutch firm NXP could be part of a newer Beijing strategy for buying western chip-related assets focused on older, less sensitive technologies and smaller companies.
China buys NXP assets
Even as its bid to take over a leading German robotics firm shows signs of crumbling, China is attempting yet another high-tech purchase in Europe with a newly announced plan to buy a major part of the business of microchip maker NXP Semiconductor (Nasdaq: NXPI). China tech watchers will know the earlier crumbling bid I’m referring to is coming from Chinese home appliance maker Midea (Shenzhen: 000333), which is trying to buy a major stake in Germany’s Kuka (Frankfurt: KU2). Now this newest bid has a couple of Chinese investment companies offering to pay $2.75 billion for NXP’s standard products business, which makes diodes, transistors and other basic parts for cars and consumer devices. Read Full Post…
Bottom line: Okmetic’s sale to a Chinese buyer was uncontested because of the company’s small size and youth, but the case could be closely watched to see how China might handle future takeovers of larger western chip makers.
Okmetic shareholders approve China takeover
China’s sudden appetite for overseas high-tech chip makers is attracting growing resistance from wary western governments, but one deal that seems to be avoiding such tensions is the purchase of Finnish company Okmetic (Helsinki: OKM1V). Just 2 months after announcing its plans to be acquired by China’s National Silicon Industry Group (NSIG), Okmetic has moved steadily forward with the plan and has just announced that holders of an overwhelming 93 percent of its shares have agreed to accept the offer. (company announcement) Read Full Post…
The following press releases and news reports about China companies were carried on June 15. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Sees Growth Rising to 48 Pct in First Forecast (English article)
ChemChina, New Hope Said to Weigh McDonald’s (NYSE: MCD) Franchise Bids (English article)
Yingli Green Energy (NYSE: YGE) Reports Q1 Results (PRNewswire)
China’s Midea (Shenzhen: 000333) Wants Only 49 Pct of Kuka: Sources (English article)
NXP (Nasdaq: NXPI) Selling Products Unit for $2.75 Bln to Chinese Group (English article)
Bottom line: New remarks by TSMC Chairman Morris Chang could signal a revival of several stalled mainland investments in Taiwan’s microchip sector, with new focus on creating mechanisms to prevent IP theft.
TSMC remarks hint at revival of China-Taiwan chip deals
New reports are citing one of Taiwan’s most influential technology executives saying he welcomes investment from China, offering a tantalizing new path to the island for Chinese high-tech firms who so far have been rebuffed in such moves. The new signals are coming from the chairman of leading Taiwanese high-tech chip maker TSMC (Taipei: 2330), who is saying he could accept a Chinese investor as a strategic stakeholder as long as the company doesn’t require a place on his company’s board. Read Full Post…
The following press releases and news reports about China companies were carried on June 7. To view a full article or story, click on the link next to the headline.
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Bitauto (NYSE: BITA) Announces $300 Mln Investment from Tencent, Baidu, JD.com (PRNewswire)
Suning (Shenzhen: 002024) Pays 270 Mln Euros for 70 Pct of Soccer Club Inter Milan (Chinese article)
TCL (Shenzhen: 000100) to Take Handset Maker TCL Communication (HKEx: 2618) Private (English article)
Yingli (NYSE: YGE) Announces Preliminary Financial Results for Q1 (PRNewswire)
Bottom line: Washington is likely to find Huawei guilty of illegally selling US equipment to Iran, while Germany is likely to scuttle a Midea-Kuka alliance by finding an alternate strategic local investor for Kuka.
US seeks documents from Huawei
Cross-border trade involving sensitive technologies is dominating the headlines as we head into summer, lead by a new development in Washington that looks ominous for Chinese telecoms giant Huawei. That news has the US asking Huawei for documents related to previous sanctions against the company, implying new sanctions could be coming over sales to Iran that may have violated US trade rules. The other headline shows opposition continuing to grow in Germany over a proposed purchase of 30 percent of local robotics firm Kuka (Frankfurt: KU2G) by Chinese home appliance giant Midea (Shenzhen: 000333). Read Full Post…
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…
The following press releases and news reports about China companies were carried on June 3. To view a full article or story, click on the link next to the headline.
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Didi Chuxing, Uber Compete for Most Funds in Latest Drives (Chinese article)
Alibaba (NYSE: BABA) Announces Terms of Share Purchase from SoftBank (Businesswire)
China Says Midea’s (Shenzhen: 000333) German Robot Deal Shouldn’t be Politicized (English article)
Taobao Invests 28.2 Bln Yuan in Suning (Shenzhen: 002024), Becomes 2nd Largest Shareholder (Chinese article)
US Requests Documents From Huawei on Previous Trade Sanctions (Chinese article)
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…
Bottom line: Pony Ma’s big charitable donation reflects some restlessness with his Tencent empire, while Robin Li’s potential pursuit of the AC Milan soccer club reflects a recent interest by Chinese billionaires in sports club ownership.
Robin Li chasing AC Milan?
Two of China’s richest Internet entrepreneurs are in the headlines today for their personal spending, led by a huge gift from Tencent (HKEx: 700) chief Pony Ma as he follows many of his western peers into philanthropy. Meantime, Baidu (Nasdaq: BIDU) chief Robin Li may also be following several of his Chinese peers into the realm of sports team ownership, with word that he may be one of the leaders of a group aiming to buy Italian soccer club AC Milan.
Neither of these stories will have much impact on Tencent or Baidu, since both involve each companies’ founder engaging in personal interests. But they do provide some insight into the personalities of these multi-billionaires, who still make most or all of the major decisions about their companies. Read Full Post…
The following press releases and news reports about China companies were carried on March 31. To view a full article or story, click on the link next to the headline.
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Zheshang, Tianjin Banks Underwhelm in Hong Kong Debut (English article)
Midea (Shenzhen: 000333) Pays 53.7 Bln Yen for 80.1 Pct of Toshiba’s Appliance Unit (Chinese article)
ICBC (HKEx: 1398) Reports Annual Results for 2015 (HKEx announcement)
