Bottom line: Billionaire Guo Guangchang’s new sporting venture reflects his desire to move into entertainment, and also to win goodwill by supporting Beijing’s initiative to build up Chinese athletics.
Fosun’s Guo in sports tie-up with Europe’s GestiFute
After his brief and somewhat ominous disappearance last month, the man once called China’s Warren Buffett is back in the headlines, with word that Guo Guangchang has joined the growing ranks of Chinese billionaires making major investments in sports. In this case Guo is teaming up with Portuguese “super broker” GestiFute, whose main business is engineering the deals that allow European players to move from one soccer club to another. Among its deals, GestiFute was involved in previous transfers involving superstar Cristiano Ronaldo, showing the company is itself a major player in the business.
This particular deal is just the latest by some of China’s richest men and biggest private companies, which have suddenly discovered a huge appetite for all things sports. Previous investors in the growing trend include Alibaba (NYSE: BABA) founder Jack Ma and Wanda Group chief Wang Jianlin, who are 2 of the country’s wealthiest individuals. They also have been joined by a growing number of entertainment-related companies like online video firm LeTV(Shenzhen: 300104) and electronics retailer Suning (Shenzhen: 002024), which also owns a major online video site. Read Full Post…
The following press releases and media reports about Chinese companies were carried on January 13. To view a full article or story, click on the link next to the headline.
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China’s Wanda Buys Film Studio Legendary for $3.5 Bln (English article)
Baidu (Nasdaq: BIDU) Halts Commercial Tie-Ups in Disease Area of Tieba Social Service (Chinese article)
Ctrip (Nasdaq: CTRP) Fake Ticket Scandal Exposes Gray Areas in Food Chain (Chinese article)
Bottom line: Sina’s new deal to broadcast the video channel of the Manchester United soccer team looks like a good bet, while LeTV’s new deal to broadcast US baseball games is more likely to strike out.
Sina tries soccer with Man United
Leading web portal Sina (Nasdsaq: SINA) and online video giant LeTV (Shenzhen: 300104) have just announced 2 new sporting deals, extending a recent streak of similar investments by media companies in search of exclusive content. The first deal will see Sina become the official broadcaster in China for Britain’s Manchester United soccer club, while the second will see LeTV’s sports division get similar rights for live broadcasts of US Major League Baseball (MLB).
Both moves are really just licensing deals, though each could become an important new revenue source for Sina and LeTV as they search for exclusive content to lure viewers to their services. From a quantity perspective, LeTV is the big winner in this new round of deals since it will gain rights to hundreds of baseball games played in America each year. But Sina is the winner from a quality perspective, since soccer is far more popular in China than baseball, which is relatively unknown among average Chinese. Read Full Post…
Bottom line:Wanda’s decision to set up its sports division headquarters in Guangzhou is part of a diversification away from Beijing, and could presage an IPO for the unit in Hong Kong as early as next year.
Wanda sets up sports HQ in Guangzhou
A recent series of major sporting moves is back in the financial headlines as 2016 approaches, with word that real estate giant Wanda Group is setting up a new headquarters for its growing sports business in the southern city of Guangzhou. Those same reports hint at another major theme in the new year, which could see a new wave of IPOs for some of these big new sporting investments by names like Wanda.
Sporting investments have become a major theme in the current year, reflecting a sudden desire for content and related services to feed China’s fast-growing entertainment sector. E-commerce giant Alibaba (NYSE: BABA) kicked off the wave last year with its investment in a domestic soccer club, and has been joined this year by a wide range of companies that includes Wanda, electronics retailer Suning (Shenzhen: 002024) and online video operator LeTV (Shenzhen: 300104). Read Full Post…
Bottom line: CMC’s purchase of a stake in the parent of the Manchester City soccer club looks at least partly political, and could be followed by similar purchases by Alibaba or LeTV next year as companies try to earn goodwill from Beijing.
CMC buys into global soccer
Anyone who thought the entrepreneurial China Media Capital (CMC) might represent a new breed of market-oriented Chinese investors will be disappointed to learn the company’s latest purchase looks quite political and aimed at pleasing Beijing. That investment has the Shanghai-based CMC teaming up with the financial giant Citic Group, another highly political animal, to buy 13 percent of a company whose prize asset is the Manchester City soccer club.
I’m probably being slightly unfair in calling this move purely political, since China is certainly a soccer-crazy country that could benefit from the expertise that CMC will get through its investment in City Football Group (CFG). But the timing of this deal looks quite suspicious, as it comes just weeks after Chinese President Xi Jinping visited the team during a tour of Britain, where he released a plan to turn China into a soccer powerhouse. Read Full Post…
Bottom line: Chinese video- and entertainment-related companies will continue to attract big investments and valuations over the next year due to their strong growth potential, even as sentiment cools towards other new media companies.
Mango TV eyes major new funding
Investor sentiment may be rapidly cooling towards many Internet areas in China, but entertainment is one that still remains quite popular. That’s my latest read on the markets, following news of major new financing for 2 companies and a new Sino-foreign co-production deal in the hot video and movie-making sectors.
Up-and-coming online video operator Mango TV is at the center of the biggest news in terms of value, with media reporting it’s aiming to raise a hefty 20 billion yuan ($3.2 billion) in just its second funding round. Movie ticket booking app Weiying Shidai is in a smaller but still sizable fund-raising headline, with reports that it has just raised 1.5 billion yuan in its third funding round. Last but not least is word of a film co-production deal between local studio Huace (Shenzhen: 300133) and global giant Twenty-First Century Fox (Nasdaq: FOX). Read Full Post…
The following press releases and media reports about Chinese companies were carried on November 17. To view a full article or story, click on the link next to the headline.
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Tsinghua Unigroup to Invest $47 Bln to Build Chip Empire (English article)
The following press releases and media reports about Chinese companies were carried on November 5. To view a full article or story, click on the link next to the headline.
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Canadian Solar (Nasdaq: CSIQ) Submits Confidential YieldCo Registration Statement (PRNewswire)
Dali Foods Seeks Up to $1.34 Bln in Hong Kong IPO (English article)
Wanda Closing Dept Stores, Suning (Shenzhen: 002024) to Take Over Some (Chinese article)
Mindray (NYSE: MR) Enters into Definitive Merger Agreement for Going Private (PRNewswire)
Tongcheng Forms JV with Japanese Travel Agent HIS (Chinese article)
Bottom line: Tongcheng’s new fund raising and Ctrip’s launch of an offshore hotel investment fund reflect the huge amount of investor dollars flowing into China’s online travel market, which will keep competition intense for the next 1-2 years.
Tongcheng in major new funding
Two of China’s leading online travel sites are in the headlines with major new initiatives, led by a massive fund-raising and even larger promotional spending plan by aggressive up-and-comer Tongcheng. The other major headline has industry leader Ctrip (Nasdaq: CTRP) setting up a fund to invest abroad, as it looks for new growth outside its overheated home market.
The pair of stories point to the huge potential for China’s domestic travel market, but also the fierce state of competition. Such conditions spotlight the need for consolidation, which seems to show signs of coming from time to time, only to collapse due to the fiercely independent nature of the company founders who are also usually their chief executives. Read Full Post…
The following press releases and media reports about Chinese companies were carried on July 21. To view a full article or story, click on the link next to the headline.
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Micron (Nasdaq: MU) Does Not Believe Deal With Tsinghua Is Possible – Sources (English article)
Huawei’s H1 Revenue Up 30 Pct Year-on-Year at $28 Bln (English article)
Travel Site Tongcheng Launches 100 Bln Yuan Promotion, Links With Wanda (Chinese article)
Uniqlo Leaves JD.com (Nasdaq: JD) After 3-Month Trial (English article)
Bottom line: Xiaomi’s and Wanda’s moves into financial services look logical but a bit late, and could struggle to compete with earlier initiatives from the likes of Alibaba, Tencent and Baidu.
Xiaomi joins partners in new bank plan
With just about all the major Internet players moving into financial services, it’s been somewhat surprising that smartphone sensation Xiaomi hasn’t joined the trend yet. The same can be said for Wanda Group, which is moving beyond its traditional strength in real estate with plans for a major e-commerce venture and plays in the entertainment space.
That looks set to change soon, however, with separate reports saying both Xiaomi and Wanda are planning moves into China’s financial sector that is being opened to private money after years of domination by big state-owned companies. Xiaomi’s move comes in an announcement from an obscure company called Hebang Corp (Shanghai: 603077), which says the pair are part of a group that plans to open a privately funded bank. Meantime, Wanda’s plan comes in a report citing company chief Wang Jianlin saying he is planning to make some major purchases in the financial services arena. Read Full Post…
