Hong Kong

Li Ka-shing dual listing plan more than cosmetic

4 Mar 2014

The tycoon wants to list his A.S. Watson unit in London or Singapore as well as Hong Kong. For most companies the attractions of multiple listings are skin deep. But if the health and beauty retailer can claw its way into several benchmark indices, it could prove an exception.

China copper IPO seeks gold in financial recycling

18 Feb 2014

Unloved Chinese companies with U.S. listings will be watching China Metal. Just 15 months after it quit the NYSE, the copper recycler is going public in Hong Kong at 10 times its last public market value. With earnings polished by tax refunds, any upside may be short-lived.

From soccer pitch, lessons on Chinese tycoon risks

14 Feb 2014

As trophy hunters flash more cash overseas, the sale of 12 pct of Birmingham FC by a Hong Kong tycoon to an obscure Chinese entity offers a cautionary tale. Having a big personality as a big shareholder is risky, but Chinese buyers bring extra anxieties.

Lenovo’s turnaround trick will be harder this time

13 Feb 2014

Buying IBM’s PC unit launched the Chinese group onto the global stage. Absorbing Motorola poses a similar challenge with a smaller upside: the U.S. handset maker is no longer a brand leader. Cost savings and scale should help reduce losses, but Lenovo’s timeline is ambitious.

IPO flops will come back to haunt Li Ka-shing

5 Feb 2014

The tycoon’s HK Electric utility is trading 5 pct below its offer price and is the third spinoff in a row to lose money for investors. Li’s reputation as a canny trader is well deserved. But that will make it harder to get a premium valuation for his retail business, A.S. Watson.

Dual-currency IPO benefits everyone but investors

27 Jan 2014

Chinese pork producer WH Group may offer new shares in both Hong Kong dollars and yuan. The move would help Hong Kong’s drive to be the Chinese currency’s leading offshore hub, and win political favour in Beijing. But the structure holds little appeal for serious investors.

Hong Kong investors see double with nightclub IPO

24 Jan 2014

Mom and pop shareholders are fist-pumping to the city’s hottest offering: shares of Magnum Entertainment doubled on their debut. Novelty, not financials, is fuelling demand. Hong Kong’s most over-subscribed listing looks just like its clubs: overhyped with long lines at the door.

Hong Kong can’t build away high house prices

16 Jan 2014

The government is freeing up land and loosening planning laws to boost supply and make housing more affordable. But new construction will struggle to keep up with demand. Until interest rates rise or capital flows from China ease, Hong Kong property prices will remain stretched.

Hong Kong power IPO less generous than it looks

13 Jan 2014

Li Ka-shing’s utility spinoff is luring shareholders with a dividend yield of more than 6 percent. Though the business itself is stable, its debts make earnings vulnerable to higher borrowing costs. Rising rates will also give investors a bigger choice of income-earning assets.

Richard Li’s $2.4bln CSL deal reconnects with past

20 Dec 2013

The Hong Kong mogul’s telecoms group HKT is paying 6.1 times adjusted EBITDA to buy back the mobile company he sold to Telstra in 2001. The synergies needed to justify a premium of roughly 31 percent aren’t too taxing. HKT ends up more indebted, but it’s basically a happy reunion.

Li Ka-shing IPOs could be HSBC’s breakout moment

19 Dec 2013

The Hong Kong tycoon has handed the bank juicy mandates to help list two of his companies. That’s significant. HSBC has never quite managed to turn its formidable Asian corporate banking relationships into deal fees, to rivals’ relief. Things might finally be coming together.

HK inside-trade payout more deterrent than portent

13 Dec 2013

A former Morgan Stanley banker must repay Hong Kong investors $3 million in illegal trading gains. The ruling is another warning for would-be insider traders. But few cases are quite so clear-cut. Investors hoping for a rush of future compensation payments will be disappointed.

How Cinda squares China’s debt triangles

27 Nov 2013

The “bad bank” has spotted a clever arbitrage: borrow cheaply from other banks and buy companies’ short-term loans to each other. That addresses one of China’s most worrying trends, and reduces the risk of contagion if debts go bad. But it will only work in China’s closed system.

China bad bank emerges as not-so-bad IPO

25 Nov 2013

Cinda was created to bail out banks; now it mostly bails out companies. A boom in corporate indebtedness helped it expand earnings by 35 percent in the first half. If the economy worsens, there’s more to buy – but the prospects for its $21 billion portfolio would worsen too.

Hong Kong tycoons diverge in power plays

19 Nov 2013

The Kadoorie family’s CLP Holdings is buying local electricity assets from Exxon Mobil for $1.8 billion. That’s a contrast with rival Li Ka-shing who is reducing his exposure. CLP’s struggle to build an international business gives it an incentive to double down in the territory.

Shuanghui hits on recipe for meaty returns

15 Nov 2013

Take lukewarm U.S. pork producer Smithfield. Slather with debt, remove from the market then serve up almost immediately in a Hong Kong IPO. To ensure the new listing comes out golden, add the secret ingredient: investor exuberance over Chinese consumer stocks.

White male banker jabs at finance’s glass ceiling

8 Nov 2013

HSBC chief Stuart Gulliver says the bank must rethink its culture to attract and retain more senior women. Though the insight is hardly new, it’s still unusual for male CEOs to publicly admit the problem. The next challenge is for HSBC to show it can live up to Gulliver’s ideal.

HSBC stuck on a treadmill but getting fitter

4 Nov 2013

Despite flat income, underlying pretax profit rose 10 pct in the third quarter. Lower costs, fewer bad debts and a lack of big fines helped. HSBC’s long-term fortunes depend on GDP growth and interest rates. In the meantime, shareholders can at least expect steady dividends.

HK anti-foreigner property tax hits wrong target

25 Oct 2013

It’s a year since Hong Kong whacked a 15 percent levy on non-resident buyers. Luxury apartment values are subdued and speculators have moved on. But smaller flats are still getting more expensive. Only higher interest rates and increased supply will reverse the trend.

China bank IPO shows rewards of financial alchemy

24 Oct 2013

Bank of Chongqing’s remarkable 32 percent return on equity relies on a trick that is all the rage for the country’s lenders: repackaging loans to look like low-risk investments in other banks. For investors it’s a profit opportunity. For regulators, it’s a potential nightmare.