Private equity battens on the Asian state 15 Nov 2018 Australia’s Royal Commission, a P2P lending crackdown in China and a Korean tax overhaul were touted as opportunities at Hong Kong’s PE powwow this week. The industry usually leans on banks to find targets, but a surfeit of dry powder has it hoping governments can create deals.
Chinese tourists leave investors holding the bag 14 Nov 2018 Luggage giant Samsonite said mainland sales fell 5 pct last quarter, blaming trade tension and consumer anxiety. Travel website Ctrip is now more cautious, while peer Tongcheng-Elong shrank its IPO. The gloom will globe-trot, including to the planned market debut for Club Med.
Australia’s CKI veto scrambles the China message 8 Nov 2018 Canberra is set to block the $9.4 bln takeover of its biggest gas pipeline company by an arm of Hong Kong's CK Hutchison. APA shares have lagged, hinting at some risk. Timing the news to coincide with a much-vaunted trip to repair ties with Beijing, though, looks careless.
Xi enters Shanghai in high-stakes tech IPO race 6 Nov 2018 China's leader granted the city a new board to compete with Shenzhen and Nasdaq for startups. It also will test a looser U.S.-style registration system for new listings. The steps are overdue, but officials may rue the governance risks and trading volatility they’re apt to bring.
Trade and pig diseases infect China’s pork giant 31 Oct 2018 WH Group, $11 bln owner of U.S.-based Smithfield, is fighting a losing battle on two fronts. Deadly swine fever is sweeping China, while tariffs hammer its American market. Quarterly earnings fell by almost a third from a year earlier. It will get worse before it gets better.
Hostile buyer may lose at Hong Kong hide-and-seek 26 Oct 2018 Private equity firm PAG is trying to bypass a property owner’s management with its takeover bid. Local conventions make it hard to track down Spring REIT’s many small investors and there are restrictions on contacting them directly. It’s time to rewrite the rules of the game.
China’s tech hub warrants an upgrade from Beijing 22 Oct 2018 Shenzhen has morphed from tiny market town to a $320 bln economy. Conferring a province-like status on it would boost Xi Jinping’s plans to integrate the surrounding region. Having more power in the capital amid a trade war also could help champion the likes of Tencent and DJI.
Hong Kong’s political risk takes new form 9 Oct 2018 Leader Carrie Lam has made a good start tackling a housing crisis, and public sentiment is improving. With mass protests less likely, she may push for a controversial security law next. The business community appreciates stability, but eroding rule of law is a rising threat.
Italy’s 5G auction is an $8 billion smash-and-grab 3 Oct 2018 The cash-strapped country raised more money than expected thanks to the canny way it sold mobile spectrum. The consequences are for others. If operators raise prices, it’s effectively a stealth tax. If they can’t, there will be less cash to build new networks in Europe.
Cull of bank traders is on the cards 26 Sep 2018 Global fixed income trading revenue has fallen faster than headcount over the past four years, according to Coalition. Pressure is growing on banks, especially in Europe, to cut costs. Technology will replace more humans on the dealing floors.
Meituan Dianping feeds into Chinese tech fears 13 Sep 2018 The Tencent-backed super-app owner raised over $4 bln in its IPO. Big fund managers could scarcely afford not to buy shares, but mom and pop investors were less enthusiastic than for other recent market debuts in the sector. It’s a good indication of waning investor appetites.
Chinese $5 bln winter sports bid is hard to beat 11 Sep 2018 Fujian-based Anta has approached Finnish ski-wear maker Amer. The offer values the group at a hefty 17 times EBITDA. Anta’s need to fend off U.S. peers in its home turf suggests it will pay more than any rival. Still, the target’s share price suggests investors aren’t convinced.
China’s London stock bridge goes halfway across 5 Sep 2018 Beijing has new draft rules for investing between the Shanghai and London exchanges. In theory the channel could see Chinese punters put billions into UK shares, as they have in Hong Kong. It’s otherwise more about diplomatic relations than market demand.
China’s yuan support scaffolds its developers too 31 Aug 2018 Real estate firms like Evergrande are sitting on some $120 bln in offshore dollar debt, nearly double 2016 levels. That’s a worry as the yuan weakens, raising costs. Beijing's latest efforts to slow the currency’s decline, though, has bought a critical sector some time.
HSBC downgrades rainmakers to a nice-to-have 23 Aug 2018 The departure of a senior UK advisory banker underscores the lender’s lowly status among global investment banks. Year-to-date M&A fees are broadly half what they were in 2015. But a focus on trade-related income means boss John Flint needn’t chase pricey dealmakers.
Hong Kong office space gets unneeded bitcoin lift 23 Aug 2018 Cryptocurrency exchange operator BitMEX is paying a record $344 a square foot per year to rent in the world’s priciest commercial property market. Chinese capital controls and rising interest rates haven’t cooled things off. The city’s real estate is a safer bet than bitcoin.
China’s Xiaomi passes first public market test 22 Aug 2018 After a bumpy IPO, the newly listed handset maker delivered better-than-expected maiden results, with quarterly sales up 68 pct to $6.6 bln. Smartphones and gadgets did well at home and abroad. If that growth continues, investors may cut Xiaomi some slack on internet services.
Hong Kong death offers humbling reminder to CEOs 21 Aug 2018 Shares of snack store operator CEC doubled following news that its founder had unexpectedly died. Research suggests such investor reactions are common, albeit usually less dramatic. Boards and bosses often contribute less value than they otherwise might think.
Soybeans strain Beijing’s trade war messaging 15 Aug 2018 China is likely to buy more of the animal feed ingredient from the United States, even after tariffs. That's despite government assurances it can diversify away from more than $12 bln of annual U.S. purchases. Markets sense it coming; others might soon see through bluster too.
Cathay’s improved flight path is still bumpy 8 Aug 2018 Halfway through a turnaround, the Hong Kong carrier reported a narrower half-year loss and higher fares. That's reassuring after price pressures at rival Singapore Airlines. But a more tangible trade war, rising costs and a weak yuan may yet test the recovery its shares expect.