Global taxi app alliance will test faith in Uber 4 Dec 2015 Car-hailing firms in India, China, Southeast Asia and the United States will link their apps. It’s not clear how many people will use it or how revenue will be shared. The anti-Uber coalition’s main impact may be on the Silicon Valley darling’s ability to keep raising funds.
China’s music dream is out of tune with reality 4 Dec 2015 State planners are good at building bridges and roads. Appealing to consumers is harder. Their latest goal is to expand China’s music business to $47 bln by 2020 – almost three times the current size of the U.S. market. It just shows how out of touch bureaucrats are.
Yahoo sale would carry a warning from print 3 Dec 2015 The internet company may be putting itself on the block. Private equity is interested – and perhaps in L.A. Times parent Tribune, too. Both are plagued by a long-term decline in advertising revenue. LBO shops fell victim to that disease with newspapers a decade ago.
Qihoo buyout depends on China’s retail investors 3 Dec 2015 The Chinese web group is finalizing an $11.8 bln take-private bid. After contributing their own shares and tapping banks, bosses still need to find half that amount in fresh equity. Onshore wealth management firms who tap China’s mom-and-pop shareholders may help fill the gap.
Yahoo CEO has run out of time for a turnaround 2 Dec 2015 After three years, it’s clear neither Marissa Mayer – nor maybe any top executive – can save the flailing internet company. The board’s job now should be to determine the best way to tidy up the firm’s affairs. Mayer’s best legacy may be that she got a good price for the core business.
Another reckoning looms for Sharp 2 Dec 2015 Lenders have bailed out the embattled Japanese electronics firm twice in the past three years. A more radical overhaul now looks likely – perhaps involving state-backed fund INCJ and affiliate Japan Display. If credit markets are right, there is little value for shareholders.
Essar buyout exposes Indian stock market weirdness 2 Dec 2015 Minority investors approved the delisting of Essar Oil last year. Now the controlling Ruia brothers are planning to sell half the $4.5 bln company to Russia’s Rosneft. The regulator has ordered Essar to compensate investors later. It’s a bizarre outcome in which no one looks good.
Manchester City deal is good business for China 1 Dec 2015 Sport tends to consume capital rather than create it. Acquired kudos often bridges the gap. The $400 mln investment by two Chinese groups in one of the UK’s most successful teams could break the mould. Still, investors in English soccer still seem to value trophies above profit.
China’s new currency status points to weaker yuan 1 Dec 2015 Joining the IMF’s reserve basket is a symbolic feat. China is still a long way from letting free markets set the value of its currency. But a slowing economy, lower interest rates and capital outflows all suggest the yuan will continue to slip against the resurgent U.S. dollar.
South Korean web bank hopes ignore offline gloom 1 Dec 2015 The country has given the green light to two groups to set up internet-only banks. Foreign web giants including Alibaba and eBay have joined local companies to back the new ventures. The euphoria is oddly disconnected from the poor returns earned by country’s largest lenders.
China will find schmoozing IMF was the easy bit 30 Nov 2015 The yuan has made it into the global lender’s basket of reserve currencies, despite China’s patchy reform record and clumsy market interventions. For Beijing politicians, getting into the IMF’s club is itself a reward. Persuading investors to want more yuan will be tougher.
Toshiba’s overdue nuclear illumination is welcome 30 Nov 2015 The scandal-hit Japanese group has been too fuzzy about the performance of important businesses. Now it has finally laid out the finances and outlook for various key units. Improved disclosure, plus growth potential in nuclear power, should help restore some market confidence.
Bank of East Asia feels weight of its China drive 30 Nov 2015 The Hong Kong lender has the second biggest branch network of any foreign bank in the People’s Republic. But fast expansion has come at a cost: BEA underperforms rivals. With activist Elliott still building its stake, it’s a good time to focus on improving profitability.
Indian sale makes Bain Capital rare buyout hero 27 Nov 2015 The U.S. firm has sold its remaining $116 mln stake in Hero MotoCorp four years after investing in the world’s largest motorbike maker. In rupee terms, Bain doubled its money in four years. As private equity pours into India, it’s a reminder that getting money out remains harder.
Jack Ma paper chase is test of newsprint’s appeal 26 Nov 2015 The Alibaba founder is interested in buying Hong Kong’s South China Morning Post. The 112-year old title’s earnings are under pressure, and the financial logic looks thin. But as fellow e-commerce boss Jeff Bezos showed with the Washington Post, newspapers still have trophy value.
Qube edges ahead in Aussie infrastructure fight 26 Nov 2015 Brookfield’s $6.5 bln agreed bid for Australia’s Asciano has hit serious opposition from competition regulators. The Canadian group could yet salvage its takeover. But interloper Qube, whose break-up consortium is already examining Asciano’s books, now looks like the favourite.
BHP and Rio look out of touch on China 25 Nov 2015 Low-cost iron ore miners BHP Billiton and Rio Tinto are accomplished experts digging for the ferro-raw material. They are much less good at consumption estimates. With the ore at 10-year lows, the companies’ investment cases depend on them getting ahead of China’s demand curve.
Playground weaklings give Li Ka-shing bloody nose 25 Nov 2015 Hong Kong shareholders rejected the tycoon’s $12.4 bln bid to merge his listed energy and infrastructure units. It’s another sign institutions in the Chinese territory are increasingly willing to exercise their limited powers. Companies can no longer take support for granted.
Malaysia remains fragile despite China power deal 24 Nov 2015 Troubled sovereign fund 1MDB will sell power assets to China’s CGN for $2.3 bln. To resolve its debt woes, the investor still needs to execute a larger bailout deal with Abu Dhabi. Even then, graft probes will keep up the pressure on Malaysia’s prime minister and the currency.
Alibaba throws a wrench in web fundraising wars 24 Nov 2015 The e-commerce giant is offloading its stake in Meituan Dianping at the same time as the Chinese startup raises up to $3 bln in new funds. The parallel sales will test investor demand for “online-to-offline” services. Alibaba’s exit will offer a clearer picture of valuations too.