China’s e-commerce secret weapon: the delivery guy 11 Aug 2014 Fast, cheap delivery has fuelled online shopping, and the growth of companies like Alibaba and JD.com. Thank a plentiful workforce of low-cost couriers that U.S. rivals can only dream of. While that can last for a few more years, unhelpful demographic change is in the post.
BlackRock is right: European IPOs need more work 8 Aug 2014 The giant investor is griping again about new issues. In structure and deal volume, the market is far healthier than when BlackRock spoke out in 2011. Performance is OK, barring a few duds. But there are still too many banks per deal and buyers are still rushed into decisions.
Green high-yield craze is too hot and full of wind 21 Jul 2014 The latest U.S. antidote to meager interest rates is the “yieldco” – collections of wind farms and solar plants. Demand is strong for the fledgling asset class, with six IPOs in a year. But ardor for the likes of NRG and TerraForm has driven valuations to unsustainable heights.
The perks and pitfalls of depending on Jack Ma 21 Jul 2014 Alibaba’s founder, chairman and spiritual sultan will continue to exert near-total control of the Chinese e-commerce giant even after its massive IPO. For prospective shareholders, the question is whether Ma can be trusted to act in their interest. The answer is a qualified yes.
WH Group’s revived IPO shows one lesson learnt 14 Jul 2014 The Chinese pork producer is planning a re-run of its failed IPO, having cut the size, valuation, and number of advisers. WH Group learned that being too greedy doesn’t pay. But without an exuberant price, it’s not clear why it is rushing back to market at all.
China money market craze is slower but not over 14 Jul 2014 Funds like the one linked to Alibaba attracted less cash in the second quarter, after sucking in $105 bln in the previous three months. Falling interbank rates help explain the slowdown. But as long as bank deposit rates are capped China’s savers will seek out alternatives.
IPO spat highlights sell-side weaknesses 9 Jul 2014 Independent advisers are popular on European new issues. Now the bookrunners they police are moaning that their presence leads to overpriced floats. While the charge looks spurious, the row points to the need for transparency in the role of sell-side analysts during IPOs.
Internet ads add up for China’s party mouthpiece 8 Jul 2014 The online arm of state news agency Xinhua is planning an IPO with a near-$1 billion valuation. Booming advertising has brought it success that has eluded the Western media. Xinhuanet’s fortunes aren’t built on headlines or scoops, but a lucrative monopoly on the PRC’s PR.
Supercharged IPO tax spoils need splitting 7 Jul 2014 KKR and Silver Lake are listing web hosting outfit GoDaddy. The use of what’s called an “Up-C” structure means the company will float with big tax deductions. IPO investors and existing owners will both benefit, but other IPOs with Up-Cs have seen more dubious arrangements.
Beijing Motor IPO lifts bonnet on China carmakers 7 Jul 2014 The automaker hopes a Hong Kong listing will help it cash in on China’s yearning for luxury vehicles. But its own marques lose money. Earnings depend on joint ventures with foreign groups like Hyundai and part-owner Daimler. It’s a reminder that China’s car market has two speeds.
NYSE vs Nasdaq is IPO trading at the margins 30 Jun 2014 Decisions like Alibaba’s about where to list captivate investors even though exchanges no longer compete on vital matters like liquidity. The Facebook debacle did briefly revive a debate over technology. In the end, though, little things like ticker symbols can swing the vote.
Blackstone and Bain craft a crisis keepsake 20 Jun 2014 The private equity firms are taking public Michaels, eight long years after buying the U.S. art supply retailer for $6 bln. They pieced together cost cuts, growth, debt and a dividend. A 13 pct IRR won’t be their fondest memory, but the overall project is one for the scrapbook.
Markit’s Wall Street owners craft textbook IPO 19 Jun 2014 The 15 banks on the data provider’s deal priced it mid-range and increased the shares on offer. Already valued generously, the IPO also looks set for a 10 to 15 pct first-day pop. It’s a case study in what underwriters can do for clients – even if this time it’s mostly themselves.
Hong Kong’s IPO debate risks missing the point 19 Jun 2014 A government-backed body has weighed in with proposals to make the city more appealing to new listings. But it failed to take a stand on whether to relax the rule of “one share, one vote”. Following Alibaba’s defection to the U.S., regulators need to tackle the issue head on.
Alibaba’s slow unveiling shows good and bad sides 17 Jun 2014 The e-commerce giant has revealed more details ahead of its upcoming IPO. The growing importance of commission revenue is positive. But the rapid shift to mobile transactions is squeezing margins. The quartet of non-executive directors is unlikely to win over governance sceptics.
Racy debt makes the AA’s IPO a high-octane bet 12 Jun 2014 The British roadside recovery firm is floating at an enterprise value of 4.3 bln stg. Buyers could get a bargain, but they need to be comfortable with life in the fast lane. Private equity sellers have left the AA towing abnormally large debt.
Euronext IPO will be a tough sell 10 Jun 2014 The European exchanges group reckons it’s worth up to 1.8 bln euros. The pitch relies on a 5 pct revenue growth target. With turnover declining since 2011, that’s optimistic. Anchor investors have a vested interest in backing the float. For other buyers, it’s a leap of faith.
UK spoils Europe’s $29 bln IPO boom 9 Jun 2014 Is buying new issues worth it? Across Europe, yes. This year’s top IPOs have returned an index-beating 14 pct. But while London has raised the most cash, its flotation frenzy has dented the overall performance of the region’s new share sales. No wonder investors have grown picky.
Jack Ma soccer buy does Alibaba investors a favour 6 Jun 2014 The internet giant’s founder hatched a $192 mln investment in China’s most popular team during a drinking session. Though the deal is immaterial to Alibaba’s value, it shows how the group works. It’s a reminder that investors in its IPO will be little more than spectators.
GoPro pushes to questionable extremes for IPO 30 May 2014 The maker of wearable high-definition cameras is pitching itself to investors as an emerging media brand. It’s a clever trick given the limited lifespan for standalone photography hardware. GoPro’s determination gives it a shot to make the leap, but odds of a face-plant are high.