Wed, Mar. 4, 1:58 PM
- A day after slumping to new post-IPO lows and coming within $0.03 of $80, Alibaba (NYSE:BABA) has seen dip-buyers emerge in large numbers. Naturally, Yahoo (NASDAQ:YHOO) is along for the ride.
- The gains come as a Chinese publication reports Jack Ma once said he considered acquiring Yahoo, which plans to spin off its Alibaba stake into a publicly-traded company in Q4. Ma's alleged comments: "The acquisition of Yahoo is something I worked [on] a couple of years ago, this is a political problem, not an economic problem, Yahoo is a media [company], more sensitive."
- There has already been speculation Alibaba will try to buy Yahoo's spinoff (much less politically challenging than buying the whole of Yahoo) at some point. Bloomberg's Matt Levine has noted the spinoff will have to wait a year before a deal occurs, in order to maintain its tax-free status.
- Meanwhile, Alibaba's Aliyun cloud services unit (a giant in the Chinese cloud infrastructure market) has opened a Silicon Valley data center, its first in the U.S. For now, the data center will cater to Chinese companies with U.S. operations, but it plans to go after non-Chinese clients later this year. When it does, Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), and a slew of other incumbents will be waiting.
Tue, Jan. 27, 4:14 PM
- Along with its Q4 results, Yahoo (NASDAQ:YHOO) announces its board has "authorized a plan for a tax-free spin-off of the company's remaining holdings in Alibaba Group (NYSE:BABA) into a newly formed independent registered investment company (SpinCo)."
- Shares in the SpinCo will be "distributed pro rata to Yahoo shareholders, resulting in SpinCo becoming a separate publicly traded company." After the spinoff, Yahoo will own its core business and a 35.5% stake in Yahoo Japan. SpinCo will assume no debt in the deal, and Yahoo will retain its cash.
- The spinoff is expected to be completed in Q4 2015, after a one-year lockup on Yahoo's Alibaba stake expires.
- Yahoo's 384M-share (15%) Alibaba stake has a current market value of $39.5B. The company closed today with a total market cap of $46.7B.
- Yahoo has jumped to $51.08 in AH trading. Alibaba is fractionally higher.
Dec. 31, 2014, 8:42 AM
- Streaming: Sony (NYSE:SNE), HBO (NYSE:TWX), CBS (NYSE:CBS), and Dish Networks (NASDAQ:DISH) are set to unveil streaming products in 2015. The theory of the companies that the skinny bundles will draw in more cord-cutters and cord-nevers than they will cannibalize current pay-TV subscribers will be put to the test. The rush of streaming options could help or hurt Netflix (NASDAQ:NFLX) depending upon which analysis an investor leans on.
- Theater traffic rebound: Exhibitors (CNK, RGC, AMC, CKEC, IMAX) and movie studios (LGF, VIA, VIAB, DIS, FOXA, CMCSA, TWX) maintain that the decline in theater attendance in 2014 (-6%) was due to a slate of films light on blockbusters. A bounce is forecast for 2015 with high-profile films such as Avengers: The Age of Ultron, The Hunger Games: Mockingjay Part 2, Fifty Shades of Grey, Jurassic World, Spectre (James Bond), and Mission Impossible 5 all set to premiere - along with the reboot of the Star Wars franchise in December. Capex spending on theater upgrades could also help boost in-theater spending and average ticket price for exhibitors.
- Mergers: If regulators allow the Comcast-Time Warner Cable (NYSE:TWC) and AT&T-DirecTV (NASDAQ:DTV) mergers to sail through it could clear a path for other media combinations, note analysts. Potential buyers include Alibaba (NYSE:BABA), Wanda Group, Softbank (OTCPK:SFTBY), and a TWX-rebuffed 21st Century Fox (NASDAQ:FOXA). Content producers which could be targets include Starz (NASDAQ:STRZA), Lions Gate (NYSE:LGF), DreamWorks Animation (NASDAQ:DWA), AMC Networks (NASDAQ:AMCX), and Scripps Networks (NYSE:SNI). A split-up Madison Square Garden (NASDAQ:MSG) could also be enticing.
Oct. 24, 2014, 5:16 PM
- A Brazilian site has reported acquisition-hungry Alibaba (BABA +1.4%) is looking for local M&A targets. Latin American e-commerce giant MercadoLibre (MELI +4.4%), which gets a large chunk of its revenue from Brazil, rallied today.
- Alibaba already has a sizable Brazilian presence courtesy of its AliExpress site, which sells Chinese goods at wholesale prices to non-Chinese consumers. An estimated 12M+ Brazilians visited AliExpress (available in Portuguese) in July. Steep local prices for various consumer goods has boosted Alibaba's appeal.
- Altogether, Alibaba's international commerce revenue rose 31% Y/Y in calendar Q2 to $237M, and made up 9% of total revenue.
- Earlier: Alibaba thinking of buying 37% stake in Lion's Gate
Oct. 24, 2014, 6:56 AM| 7 Comments
Sep. 29, 2014, 4:15 AM
- In its first big investment since its $25B record IPO, Alibaba (NYSE:BABA) has bought a 15% stake in Chinese hospitality technology provider Beijing Shiji Information Technology for 2.81B yuan ($459M).
- Shiji provides IT consulting and sells software that manages room reservations and point of sales systems to high-end hotels in China.
- The deal is expected to close early next month.
Sep. 10, 2014, 10:40 PM
- The guessing game has started over which U.S. companies Alibaba (Pending:BABA) might pursue after it becomes flush with IPO cash.
- If Alibaba's borrowing power is factored in, estimates for its total spending capacity range as high as $50B.
- Lion's Gate (NYSE:LGF), Red Hat (NYSE:RHT), and Akamai Technologies (NASDAQ:AKAM) have all been bantered around as potential targets.
- Though a long shot, the case for Yahoo (NASDAQ:YHOO) being in the mix is also intriguing. There's $12B in tax savings generated from Alibaba buying Yahoo - instead of Yahoo selling off its post-IPO stake in the Chinese company and paying the tax bill.
- Alibaba debuts on the NYSE on September 19.
Jul. 23, 2014, 9:40 PM
- After talking with an unnamed "large Yahoo shareholder that is preparing a presentation" featuring a similar thesis, fund manager Eric Jackson thinks there's a good chance Alibaba (Pending:BABA) or SoftBank (OTCPK:SFTBF) will acquire Yahoo (YHOO +3.3%).
- His reasoning: Whereas the value of Yahoo's stakes in Alibaba and Yahoo Japan (OTCPK:YAHOF) are currently discounted for future tax payments, the pre-tax valuations are what matter to Alibaba and SoftBank. The former would be buying back a 22.5% pre-IPO stake in itself, and the latter would be adding to its respective 34.3% and 43% stakes in Alibaba and YJ.
- Jackson estimates Yahoo's assets are worth $56/share to either acquirer - he values the post-IPO Alibaba stake at $33, the YJ stake at $9, and Yahoo's core business at $5, and adds $9 for cash (inc. IPO share sales).
- He speculates Alibaba (were it the buyer) could trade the YJ stake to SoftBank for part of its Alibaba stake (adding to the scope of its buyback), and notes new SoftBank Internet/media chief Nikesh Arora reportedly wanted to buy Yahoo while at Google.
- One caveat: Acquiring Yahoo would give SoftBank a 56.8% stake in Alibaba before factoring IPO dilution. The Chinese government likely wouldn't be pleased with that. Jackson suggests SoftBank could trade part of its Alibaba stake post-acquisition for "something of similar value," but doesn't say what.
- Previous: Alibaba reportedly planning September IPO
Jun. 23, 2014, 1:16 PM
- Sources tell dealReporter OpenTable (OPEN +0.1%) talked with bidders other than Priceline (PCLN -0.1%) before accepting the online travel giant's $2.6B bid.
- Though a higher offer is seen as unlikely, one source thinks Yahoo (set to receive an Alibaba IPO windfall) could make a bid. OpenTable is currently 1.9% above Priceline's $103/share offer price.
- Yelp (YELP +3.6%), which blasted off after Priceline/OpenTable was announced, is rallying again. Volatile restaurant deals microcap LiveDeal (LIVE +9.3%) is also up strongly.
- Previous: Street commentary on Priceline/OpenTable
Jun. 19, 2014, 1:38 PM
- Aicai, a Chinese lottery ticket site established in '07, is now fully owned by Sina (SINA -2.4%). Aicai's founding team will remain with the company.
- Aicai was established in '07, with Sina holding a majority stake. The site raised funding in '09.
- Research firm Analysys estimates Aicai had a 4.9% share of the Chinese online lottery market in Q1. 500.com (WBAI +3.2%) had a 5.8% share, Alibaba's Taibao site an 11.3% share.
Jun. 11, 2014, 2:39 PM
- Acquisition-hungry Alibaba (ABABA) is buying the 1/3 of top Chinese mobile browser vendor UCWeb it doesn't yet own for a mixture of cash and stock. The price hasn't been disclosed, but Alibaba claims the deal is the biggest Chinese Web merger in history, exceeding Baidu's (BIDU +0.4%) $1.9B purchase of app store provider 91 Wireless.
- UCWeb has a 50%+ share of the Chinese mobile browser market, and also has 35% of the Indian market. The company claims 500M total browser users, as well as 50M users for its Android app store, which competes against Baidu and Qihoo's (QIHU +3.8%) popular stores.
- More importantly for Baidu (and also relevant for Qihoo), UCWeb claims a 20%+ share of the Chinese mobile search market on the back of 100M active users. A mobile search JV was launched with Alibaba in April.
- Meanwhile, CNBC reports Alibaba will likely file a new F-1 early next week that includes its Q1 results. Odds are Yahoo (YHOO +0.6%), which has been reporting Alibaba's results a quarter in arrears, will move on the numbers.
- CNBC adds Alibaba is still expected to go public in the first week of August. Bloomberg previously reported Alibaba is eying an Aug. 8 IPO.
Jun. 5, 2014, 2:11 PM
- Alibaba (ABABA) isn't scared to go off the beaten path during its pre-IPO investment spree: The Chinese e-commerce giant is spending $192M to buy a 50% stake in Guangzhou Evergrande, China's most successful soccer club.
- "We're not investing in football, we're investing in entertainment ... Alibaba's future strategies are health and entertainment," says founder Jack Ma. With the club set to invite 20 "strategic investors" to buy 2% stakes, Alibaba's stake will eventually be lowered to 30%.
- Xu Jiayin, chairman of the company that owns Evergrande, says the deal was hatched only on Monday. "I got Jack drunk in Hong Kong and afterwards asked him if he'd invest, and he said 'okay' ... The discussions were finished within 15 minutes yesterday morning."
- Alibaba announced a $249M investment in Singaporean postal service/logistics firm SingPost last week. Prior investments: Wasu Media, AutoNavi, Intime, Haier, ChinaVision Media, Youku.
- Yesterday: Alibaba reportedly eying "lucky" 8/8 IPO
Apr. 28, 2014, 10:17 AM
- Sohu (SOHU -4.8%) missed Q1 estimates and provided light Q2 guidance. Meanwhile, as part of a recent crackdown, the Chinese government has pulled The Big Bang Theory and other popular U.S. shows from sites such as Sohu.com, Youku.com (YOKU -4.4%), Baidu's (BIDU -5%) iQiyi, and Tencent Video (TCEHY -2.8%). Time observes The Big Bang Theory has produced 1.3B video views since launching on Sohu TV in '09.
- The news is overshadowing a $1.22B investment in Youku by Alibaba (ABABA) and an affiliated P-E firm, and a WSJ report stating Alibaba is forming a mobile search JV with leading mobile browser firm UCWeb (once targeted by Baidu).
- The deals are the latest in a long line of investments and partnerships struck by Alibaba, Tencent, and Baidu, as each firm tries to build a Web/mobile empire covering over a dozen valuable markets.
- Is Qihoo (QIHU -0.8%) next in line to make a deal? With a $21.6B market cap, the security app/browser/search provider and Baidu rival is the biggest Chinese Internet company to remain independent of the big-3. Qihoo was reported in January to be talking with Alibaba.
- Other decliners: NQ -6.5%. VIPS -5.2%. WB -4.2%. WBAI -3%. LONG -4.5%. QUNR -2.4%.
Apr. 28, 2014, 7:20 AM
- Alibaba (ABABA) and Yunfeng Capital, a private equity firm co-founded by Alibaba executive chairman Jack Ma, have agreed to acquire an 18.5% stake in Youku Tudou (YOKU) for $1.22B.
- Alibaba and Yunfeng are paying $30.50 per American Depositary Receipt, or a 26.3% premium to Youku Tudou's close on Friday of $24.14.
- Alibaba will hold around 16.5% in Youku and Yunfeng 2%.
- The deal is the latest in a series of acquisitions that Alibaba has carried out over the past few months, spending at least $2.7B.
- Youku Tudou ADRs are +14.75%. (PR)
Apr. 11, 2014, 10:32 AM
- Two months after Alibaba (ABABA) offered to buy the 72% of AutoNavi (AMAP +2.5%) it didn't own for $21/share, AutoNavi has agreed to a deal.
- The acquisition price values AutoNavi at $1.5B. Alibaba has reached a voting agreement with AutoNavi investors owning 26.2% of its shares.
- The deal gives Alibaba full control of one of China's top online/mobile mapping providers ahead of its IPO, and further intensifies its rivalry with Baidu and Tencent, each of whom have their own popular mapping platforms.
- AutoNavi had 92M monthly active users for its mobile mapping apps at the end of Q4, +88% Y/Y.
Mar. 11, 2014, 4:42 PM
- Alibaba (ABABA) is spending $805M to buy a 60% stake in ChinaVision Media, a Hong Kong-based producer of films and TV dramas.
- The deal represents a big expansion of the Chinese e-commerce giant's attempts to carve a foothold in China's fast-growing and fragmented online/mobile video market. Though Youku (YOKU) remains the market's biggest player, strong competition is provided by Baidu, Sohu, and Tencent.
- Alibaba, Baidu, and Tencent have been constantly finding ways to encroach on each others' turf. Yesterday, Tencent announced it's buying a 15% stake in #2 Chinese e-commerce firm JD.com.
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