Chinese corruption drive may thin out M&A bidders 21 Dec 2015 Fosun’s decision to drop its bid for private bank BHF Kleinwort Benson may be unrelated to the brief disappearance of its boss. But corporate predators from China account for 7 pct of global cross-border takeovers. A crackdown on graft could lead to less competition for deals.
China’s P2P purge will boost Lufax and Ant 21 Dec 2015 Authorities are cracking down on a sector that houses two of the world’s most valuable financial startups, with ties to Ping An and Alibaba respectively. Peer-to-peer lending has seen explosive growth and little oversight. Driving out the cowboys should benefit the big two.
U.S., Chinese unicorns will bolt in opposite ways 21 Dec 2015 Silicon Valley firms worth $1 bln-plus in private markets have taken hits in the public eye of late: think payments firm Square or messaging app Snapchat. The PRC’s unicorns also face scepticism. Yet as U.S. startups shy away from IPOs, the Chinese species may run for them.
Qihoo gets its $9 bln buyout, against the odds 18 Dec 2015 The biggest take-private of a U.S.-listed Chinese company has been finalised despite funding challenges. Tapping retail investors may have helped raise the $6 bln equity cheque. But peers eyeing similar buyouts, before re-listing back home, could find their journey harder.
China’s catch-all financial slogan: Belt and Road 18 Dec 2015 What do investments in engineering companies, banks and bananas have in common? They’re all justified by China’s “One Belt, One Road” plan to boost trade and spread soft power. Yet early signs are the scheme is another excuse to shuffle money and favours between state companies.
Breakdown: China’s chip ambitions will jolt rivals 18 Dec 2015 National security and industrial policy are driving tens of billions of dollars of investment into China’s semiconductor industry. M&A by state firms like Tsinghua Unigroup is already rattling foreign competitors and governments. Fights over market share will follow.
StanChart belatedly fills most important role 17 Dec 2015 The emerging markets bank has hired HSBC’s Simon Cooper to run its corporate bank. Sorting out StanChart’s mess requires deep knowledge of emerging markets and corporate lending – neither of which new CEO Bill Winters obviously has. Cooper is plugging a vital gap.
Casino mogul secretly bought the wrong newspaper 17 Dec 2015 Sheldon Adelson has emerged as the mystery buyer of the Las Vegas Review-Journal. It’s not clear why the billionaire wants it, beyond solidifying his influence in Nevada. Macau matters more to his business than Sin City – maybe he should have grabbed the South China Morning Post.
Global economy depends on more than India in 2016 17 Dec 2015 The subcontinent’s expanding GDP is one of next year’s few economic bright spots. But the sluggish United States and decelerating China will still account for nearly half of global growth. Any negative shocks from the two sputtering engines will reverberate widely.
Coal is biggest risk to China’s $6 trln green goal 17 Dec 2015 The best way to cut carbon and smog is to limit the economy’s dependence on coal. Mammoth investment in alternative energy and efficient industry is required, or China will flunk its Paris vows. But finding the private capital needed to drive change will be tough.
China’s edgy tycoons will send more capital abroad 16 Dec 2015 Fosun boss Guo Guangchang is among the country’s most respected business leaders. His brief disappearance suggests no-one is safe from Xi Jinping’s graft crackdown. The heightened campaign, plus economic and currency worries, could worsen China’s capital flight problem.
GE upset offers Asian buyers way into U.S. kitchen 15 Dec 2015 The group’s appliance unit is up for grabs after a $3 bln sale to Electrolux collapsed. Buying one of the top makers of U.S. cookers, dishwashers and fridges would be transformational for Haier or Midea of China. But Panasonic, Samsung, or Germany’s Bosch might have other ideas.
China’s chip landgrab sparks $8 bln of hasty M&A 15 Dec 2015 China wants to assemble a domestic semiconductor giant via foreign takeovers. So rattled rivals are rushing to secure assets, especially in Taiwan. Micron’s $4.1 bln buyout of a JV partner makes sense. ASE’s gatecrashing of an agreed tie-up with the Chinese looks riskier.
Alibaba’s HK newspaper deal adds to mission creep 11 Dec 2015 The e-commerce giant’s purchase of South China Morning Post is an old headline with a new twist. Jack Ma follows in the footsteps of countless tycoons wielding influence through the press. The difference is that he’s forcing Alibaba’s public shareholders to lend him a hand.
Road to ruin is paved with market prophecies 11 Dec 2015 The long-range forecast factory is in overdrive as the year-end nears. But too much depends on what an unpredictable OPEC does and how the opaque Chinese economy performs. Worse still, big price trends are prone to violent upsets when too many investors jump on the bandwagon.
Fosun looks badly exposed as boss goes AWOL 11 Dec 2015 China’s top private conglomerate can’t locate Chairman Guo Guangchang. The disappearance amid a graft crackdown has spooked investors. His team can keep things ticking over. But unless he re-emerges soon Fosun’s strategy and bold overseas dealmaking are both in doubt.
LBO-style debt adds zing to Yum Brands break-up 11 Dec 2015 Kentucky Fried Chicken will stuff shareholders with $6.2 billion before spinning off its China arm. The remaining Yum will carry debt of 5 times EBITDA. That’s not too extreme for the fast food industry- but it does look a lot like a self-administered leveraged buyout.
China brokerage scandal less painful than Brazil’s 10 Dec 2015 Two top CITIC Securities executives have disappeared and BTG Pactual’s CEO is in jail. The similarities end there. While the Brazilian investment bank is in crisis, state support and a broader business mix have allowed China’s top broker to cope with a leadership vacuum.
Yahoo a good bet for Barry Diller’s menagerie 9 Dec 2015 The flailing internet firm scrapped plans to spin off its Alibaba stake and may split its search and advertising unit instead. The media mogul’s assorted online businesses could be a logical home, as might Verizon, owner of AOL. In truth, almost any deal would be a win for Yahoo.
China postal bank’s $7 bln sale evokes past frenzy 9 Dec 2015 The country’s sixth-biggest lender is selling a 17 pct stake to investors such as China Life, Temasek and CPPIB. A big IPO will follow. At a premium to book value, the $42 bln valuation recalls earlier bank privatisations. It’s a contrast to the cloud now hanging over the sector.