After buying a 12% stake in Rio Tinto Plc in February, Aluminum Corp of China Ltd (Chalco), the largest producer of metal, said it will step up its overseas expansion to ensure sustainable growth through more access to mineral resources.
The company will jointly invest in more overseas mining projects with international mining companies. It also plans to spend 1 billion yuan on a 5% stake in a proposed project with AVIC Ⅰ’s Commercial Aircraft Co.
Chalco decides to acquire more local alumina processors, most of which are struggling as slim processing fees fail to offset increase in costs. “It’s a good time to merge with small alumina processors to expand Chalco’s processing capacity in 2008,” said Xiao Yaqing, chairman and CEO of Chalco. Chalco’s processing capacity is expected to reach 1.09 million tons in 2008, largely through mergers and acquisitions.
Chalco now is also seeking opportunities to expand into other metals such as titanium and copper since aluminum producers are supposed to diversify their businesses in the face of international competition.
Popularity: 1% [?]
Chalco, China, expansion, investment, mining
Alibaba.com is the largest business-to-business website, which started out helping millions of Chinese small and medium-sized enterprises sell their goods on the internet.
Last year, the company’s revenue grew 58.6% to 2.16 billion yuan and its net profit surged 340% to 968 million yuan, which was attributed to the rise in the number of the company’s paying members and their increased averaged online consumption.
Despite the current economic slowdown at the global scale, Alibaba.com expected to see dynamic growth this year. “I think we will maintain fast growth this year because people in difficulties tend to diversify their product sourcing and supply in order to reduce risks,” said Wei Zhe, CEO of Alibaba.com.
According to Alibaba.com, 72% of the company’s revenue came from online trade between China and foreign countries and only 28% from trade within China. Revenue from domestic trade is expected to rise as China’s internal demands grow. Meanwhile, the company also has plans to open a joint venture with Softbank in Japan this year and increase its business presence in Europe and India to seek greater international opportunities.
Popularity: 1% [?]
Alibaba, China, joint venture, sourcing, trade
The world’s fourth largest computer maker Lenovo Group recently unveiled its notebook ThinkPad X300 in Beijing, hoping to regain ThinkPad’s reputation and compete with HP, Dell, Acer and Apple.
Initially introduced by IBM in 1992, ThinkPad remained the longest lasting design franchise in computing history and was lapped up by businesses and traveling users. In 2005, the brand was sold to Lenovo along with IBM’s PC division due to poor financial returns.
In the past three years, Lenovo managed to increase the annual revenue of IBM’s previous loss-making business from $3 billion to $17 billion and has nearly tripled its profits. And it feels urgent to release innovative products like IBM to prove its ability.
“The launch of the new product has proved that we are capable of making breakthrough innovations and setting new standards for the industry,” said Yang Yuanqing, chairman of Lenovo Group.
According to Lenovo’s third-quarter result ended January, its revenue reached $4.6 billion, up 15% compared with the same period of 2006. And the company’s notebook shipments grew 38% annually and sales reached $2.6 billion, accounting for 56% of the total sales.
Popularity: 1% [?]
China, Lenovo, notebook, ThinkPad
In recently years, Sohu.com Inc, the Chinese Web portal, has initiated its Olympic marketing strategy and became the official internet content sponsor for the Beijing Olympics in 2005. To avid fluctuations on the market, it has also been endeavoring to make revenue outside the online advertising sector.
Recently Sohu posted a nearly fivefold profit growth in its quarterly result, which is attributed to its sponsorship of the upcoming Olympics in Beijing and the success of an online role-playing game that it introduced last May.
Sohu’s revenue in the first quarter ended last month grew 156% to $84.8 million, while profit surged 383% to $21.6 million. Revenue from brand advertising reached $33.2 million, up 41% on a yearly basis while online game revenue increased 24 times to $41 million, boosting the company’s non-advertising revenue by 570% to $50.1 million.
A new report by Goldman Sachs indicates that the Beijng Olympics is expected to create an additional $65 million in terms of online advertising revenue for Chinese Internet companies, mainly from Olympic global partners like Samsung and Adidas that have been vigorously exploring the Chinese market.
Popularity: 1% [?]
China, online advertising, profit, Sohu
The global private equity group affiliated with Robert W. Baird & Co, Baird Private Equity will set up an investment team focused on offering growth equity capital to smaller, high potential companies in China or with substantial operations and growth opportunities in Greater China.
Baird Private Equity, owning 45 investment professionals in the United States, Europe and Asia, makes venture capital, growth equity and buyout investments in the US, Greater China and Europe. It has raised about $ 2.4 billion in venture and buyout capital across the US and European markets.
Paul Carbone, Director of Baird Private Equity pointed out that as private equity has entered China, smaller high potential companies have been neglected; however, Baird Capital Partners Asia is well-positioned to support smaller, high growth companies and their management teams. BCPA is an ideal choice for companies in China that want have access to the global financial resources and operating expertise.
In fact, BCPA is the second phase of Baird Private Equity’s strategic expansion in China. In 2003, a team of up to 20 operating professionals was built in China. They helped more than 15 Baird Private Equity portfolio companies create value by means of sourcing, manufacturing or distributing in Asia.
Popularity: 2% [?]
Baird Private Equity, China, investment, small companies
Planning to expand wireless Internet coverage in the city ahead of 2010 World Expo, Shanghai is on the way becoming China’s first “wireless city”.
The city’s first wireless hotspots created last year has now expanded to cover about 100 hotels and restaurants. According to Shanghai official’s plan, about 2000 extra network access points in the city’s public areas and wireless broadband and service will be completed in the busy commercial districts of Xujiahui, Jiading and Pudong.
The first practice of the plan has recently been carried out in the Nanjing Pedestrian Mall area. The whole wireless areas will be ready for use in 2008.
Wireless broadband network has gradually become an essential part of a city’s infrastructure and Shanghai is not the first city to become wireless. Last year, about 300 cities all over the world were trying to establish wireless broadband services. In China, Beijing, Tianjin, Wuhan, Hangzhou and Shenzhen are competing to become the first “wireless city”.
Popularity: 1% [?]
Expo 2010, internet, Shanghai, wireless broadband network, wireless city
China Life Insurance Co, the country’s biggest life insurer has invested USD 300 million in Visa’s initial public offering, making it the first mainland insurer to make a pre-listing investment in a multinational company.
The purchase is the first major investment by a Chinese insurance company in the America, especially at the time of sub prime mortgage crisis. This investment was intended to put more of the money overseas to diversify risks after China’s benchmark stock index fall. The insurer used its own foreign-currency assets to make the investment, its biggest in the US stock market.
China Life even plans further investment in the US and Europe to diversify its portfolio.
Popularity: 1% [?]
China Life Insurance, portfolio, U.S., Visa
As the Yuan has strengthened 4% against the US dollar so far this year, tax breaks for tax exporters are suggested to change the sluggish situation of textile industry.
Last year, the government reduced rebates on exports including textile, toys and steel products, making efforts to lower energy consumption and ease trade discord with the America and Europe. However, with the shutting down of many textile companies, the government should consider resuming some tax incentives to help them survive.
Aiming to maintain 15% growth in the total value of exports and imports in 2008, the government should take measures to “stabilize” investor’s expectations for the Yuan’s appreciation.
Popularity: 1% [?]
appreciation, China textile export, Chinese government, tax, tax incentives
In 2000, BASF and Sinopec set up their 50-50 joint venture BASF-YPC Co Ltd in Nanjing. This year, the two sides have reached an agreement to spend $900 million to expand their joint project to meet increasing demands in the domestic market.
The two companies have submitted the technical and commercial feasibility study for the expansion of the steam cracker from 600,000 to around 750,000 tons of ethylene per year and the expansion of manufacturing facilities of other petrochemical products. The expansions are expected in phases starting this year and the cracker expansion is scheduled between 2009 and 2010.
“The completion of the feasibility study marks an important step in the cooperation between Sinopec and BASF… it is expected to make a significant contribution to meet the domestic market demand,” said Wang Tianpu, president of Sinopec Corp.
And for the German company, “the expansion strengthens BASF’s close partnership with Sinopec. It is another significant demonstration of the company’s commitment to China’s chemical market,” said Martin Brudermuller, member of the board of executive directors of BASF.
Popularity: 2% [?]
BASF, China Business, joint venture, Sinopec
Ping An Insurance Co last month announced its plan to acquire a 50% stake in Fortis Investment Management for 2.15 billion euros from Fortis Band based in Brussels, aiming to increase its presence on the international asset management market.
In 2007, the company’s net profit rose to 19.2 billion, up by 140.2% compared with the year before, which was attributed to its “comprehensive earning mode” that seeks to balance income from insurance, banking and investment. And the total revenue last year amounted to 137 billion yuan, up 55.4% from the year before. Earnings per share was 2.61 yuan, compared with 1.27 yuan in 2006. Its rate of investment return improved from 7.7% in 2006 to 14.1% in 2007.
“The proposed equity investment in Fortis is an effective way to strengthen our competitiveness in the asset management business,” said Ma Mingzhe, chairman and CEO of Ping An Insurance. “The cooperation will enable both parties to diversify earning resources and seek greater growth in different markets.”
If approved by the managements of Ping An and Fortis Bank, the name of the joint venture will be changed to Fortis Ping An Investments, in which the two sides are equal partners.
The company looks forward to benefiting from Fortis’s asset management expertise of the highest international standard while Fortis is in a position to leverage on Ping An to expand its business in the emerging markets in the Asia-Pacific region.
Popularity: 1% [?]
China Business, Fortis, investment, Ping An
