Mon, Aug. 3, 7:03 PM
- Ctrip (NASDAQ:CTRP) is guiding for 45%-50% Y/Y RMB-based revenue growth. Consensus in dollars is for 43% growth.
- The modest size of Ctrip's Q2 sales beat could be disappointing investors, after a much bigger beat was delivered in May. Hotel (accommodation) revenue rose 47% Y/Y (volume +55%) to $178M, transportation (ticket) revenue 45% to $170M (volume +106%), packaged tour revenue 61% to $53M, and corporate travel revenue 34% to $19M.
- R&D spend rose 66% Y/Y to $128M, sales/marketing 42% to $109M, and G&A 34% to $42M. Gross margin was 71% vs. 70% in Q1 and 72% a year ago.
- Meanwhile, in tandem with its Q2 results, smaller Chinese online travel firm eLong (NASDAQ:LONG) has announced the receipt of an $18/share offer from messaging/gaming giant Tencent (OTCPK:TCEHY) to buy all of the eLong shares not currently owned by Tencent, certain members of management, and "major shareholders" controlling at least 70% of all voting rights.
- Tencent owns 15% of eLong. In May, Ctrip spent $400M to take a 37.6% stake in eLong.
- CTRP -1.7% AH to $70.25. LONG +10.1% to $15.65.
- Ctrip: Q2 results, PR. eLong: Q2 results, PR.
Mon, May 18, 3:10 PM
- Bloomberg reports Baidu (BIDU -0.8%) is teaming with top ride-sharing platform Uber and P-E firm Apax Partners to jointly bid for Nokia's (NOK +0.7%) HERE mapping/navigation software unit. Sources state the business could fetch as much as $4B.
- A rival group consisting of Chinese messaging/gaming giant Tencent (OTCPK:TCEHY), Chinese mapping firm/Tencent partner NavInfo, and Swedish P-E firm EQT Partners is also reportedly bidding. A group of German automakers (mentioned in past reports) and a trio of P-E firms are reportedly interested as well, and Microsoft (NASDAQ:MSFT) has offered to buy a minority stake.
- The next round of bids are reportedly due in 2 weeks. Baidu is said to be partnering with Uber to "avoid regulatory scrutiny." The NYT previously reported Uber has bid up to $3B for HERE, which has a dominant position in the in-car automotive market.
- Separately, Baidu has announced a "strategic investment" in content recommendation platform Taboola - readers may be familiar with the "Recommend for you" article boxes Taboola provides at the bottom of articles on partner sites. The WSJ reports Baidu, which plans to bring Taboola's platform to China, invested $20M-$30M.
Fri, Apr. 17, 9:46 AM
- 58.com (WUBA +5.2%) is buying a 43.2% stake in Chinese online classifieds rival Ganji.com for 34M shares (current value of $2.4B) and $412.2M in cash.
- The companies will "continue to operate their respective brands, websites and teams," while exploring ways to partner and "maximize business synergies." Following the deal, Ganji stands to own a 25% stake in 58.com.
- Messaging/gaming giant Tencent (OTCPK:TCEHY), which bought a 19.9% stake in 58.com last June, is investing another $400M in the company at a price of $52/share (27% below current levels). Tencent will own a 25.1% stake once the investment closes.
- The FT reported on Tuesday 58.com and Ganji.com were planning a full-blown merger, while adding (without providing details) the transaction would occur in two stages to appease regulators.
- After opening lower, 58.com has quickly shot higher. Shares are up 39% since the FT's report arrived.
- Yesterday: Morgan Stanley sees major 58/Ganji synergies
- Update (12:10PM): 58.com is now down 1.6% amid a broader market selloff.
- Update 2 (3:00PM): Shares have reversed course again. They're now up 3.9%.
Fri, Jan. 9, 10:03 AM
- Chinese mobile messaging/gaming giant Tencent (OTCPK:TCEHY) and leading direct online retailer JD.com (JD +0.8%) are directly investing $1.3B in "cash and resources" in major auto site Bitauto (BITA +8.7%), and $250M in Bitauto's YiXin Capital (online auto financing) subsidiary.
- JD will directly invest $400M in cash in Bitauto and provide $750M in resources, including "exclusive access to the new and used car channels on JD.com's e-commerce sites including mobile apps and additional support from its key platforms," in exchange for shares. Tencent will directly invest $150M in cash. JD and Tencent will respectively invest $100M and $150M in YiXin Capital.
- The deal will leave JD with a 25% stake in Bitauto, and Tencent a 3.3% stake. JD and Tencent will respectively have 17.7% and 26.6% stakes in YiXin Capital. Tencent already has a sizable stake in JD.
- Bitauto, whose shares have soared on the news, promises to "aggressively invest to solidify Bitauto's industry leadership and build market share" in upcoming months. Rival Autohome (ATHM +5.8%) is also up sharply, perhaps on hopes a Tencent/JD rival (Alibaba?) will invest in the company in response.
Aug. 27, 2014, 3:36 AM
- A 5B yaun ($813M) e-commerce joint venture between China's privately-held Dalian Wanda Group, Baidu (NASDAQ:BIDU) and Tencent Holdings (OTCPK:TCEHY, OTCPK:TCTZF) will be announced later this week, Reuters reports.
- The new venture will unite three of China's most powerful non-state companies, and will be 70% owned by Wanda and 15% held by Baidu and Tencent respectively.
- Wanda is a commercial property, luxury hotel and film conglomerate.
May 26, 2014, 8:34 AM
- South Korean mobile-messaging service Kakao has agreed to acquire Web portal Daum Communications in a reverse takeover that values Kakao at 3.1T won ($3B) and gives it a listing on the Korea Exchange.
- Kakao is on 93% of smartphones in its home country and has 140M users worldwide, although that's well below WhatsApp's 500M.
- The deal comes despite Kakao, which is partly owned by Chinese Internet firm Tencent Holdings (TCEHY), planning an IPO for next year.
- The transaction is the latest to involve a major messaging service this year, including Facebook buying WhatsApp for $19B.
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%.
Jan. 9, 2014, 3:23 PM
- Tencent (TCEHY -2.1%) hopes to make a strategic investment in Chinese e-commerce platform Jingdong, although its intention has been rebuffed thus far, BrightWire writes citing a source.
- Jingdong reportedly generated 28.6% of all Chinese B2C e-commerce site traffic in 2013 to Alibaba's 39.2%, making an investment in the company valuable for Tencent's position vs. its rival.
- At issue is Tencent's modus operandi of taking a majority position in its investments, with Jingdong reluctant to cede autonomy according to market watchers.
Oct. 11, 2013, 4:33 PM
- A day after Delaware's Supreme Court cleared the way for the deals to proceed, Activision (ATVI +0.2%) says it has closed its $5.83B, $13.60/share leveraged recap deal with Vivendi (VIVHY.PK), and that Vivendi's sale of $2.34B in shares (also at $13.60/share) to an investment group led by Activision's CEO and co-chairman has also been finished. (PR)
- Not surprisingly, Activision predicts the leveraged recap, which was financed via $4.75B in debt (average interest rate below 5%) and $1.2B in existing cash, will be immediately accretive to EPS.
- The two deals leave the investment group, which also features private investment firms and Chinese online gaming giant Tencent (TCEHY.PK), with a 24.7% stake in Activision. Vivendi retains a 12% stake.
Sep. 16, 2013, 11:44 AM
- Though Tencent's (TCEHY.PK, TCTZF.PK) acquisition of a 36.5% stake in Sohu's (SOHU +6.9%) Sogou search unit stands to make Sogou a greater threat to Baidu (BIDU +2%), given Tencent's plans to promote Sogou throughout its messaging/gaming empire, Baidu investors appear relieved Qihoo, which was in talks with Sohu, didn't end up reaching a deal.
- Research firm CNZZ recently estimated Qihoo now has over 15% of the Chinese search market, and the company itself recently pegged its share at 20%. Acquiring Sogou (estimated 8.8% share) would've given Qihoo additional scale and resources as it challenges Baidu's dominant position.
- Meanwhile, Tencent rose 2.5% in Hong Kong overnight, before the Sogou deal was announced. The company's market cap has topped $100B.
- Chinese Web giants Baidu, Tencent, and Alibaba are increasingly stepping on each others' toes. While Tencent and Alibaba have been relying on partnerships/minority investments to grow their reach, Baidu has been more interested in acquisitions and controlling stakes.
Jun. 21, 2013, 11:51 PMNaspers (NPSNY.PK), the South African media giant, together with Tencent (TCEHY.PK), its partner in JV Ibibo, is acquiring Redbus.in, the online ticketing company that Techcrunch calls "a dominant and disruptive force" in how people travel in India. At a reported price of about $120M, it would be the biggest overseas strategic acquisition of an Indian internet asset. | Jun. 21, 2013, 11:51 PM | Comment!
Aug. 20, 2012, 8:22 AMYouku (YOKU -0.1%) and Tudou (TUDO) shareholders approve Youku's all-stock acquisition of Tudou in a deal that combines China's two biggest video Web sites and creates a company with over 300M weekly users. The transaction will increase Youku's lead over rivals Baidu (BIDU) and Tencent, and should generate savings of up to $60M/year. | Aug. 20, 2012, 8:22 AM | Comment!
Jul. 6, 2012, 1:55 PMVivendi (VIVHY.PK) has reportedly hired an i-bank to gauge the market for 61%-owned Activision (ATVI -1.5%). It's added bankers are "sounding out" tech and media companies such as Tencent, Time Warner, and Microsoft, as well as P-E firms. Vivendi's efforts to sell Activision, first reported last week, are pivotal to its restructuring plans. But a buyer for the $13.3B company could be hard to come by, and many think a spin-off of Vivendi's stake is more likely. (earlier) | Jul. 6, 2012, 1:55 PM | Comment!
Mar. 14, 2012, 2:41 PMTencent (TCEHY.PK), owner of China's extremely popular QQ instant messaging platform, says it plans to make new acquisitions to lessen its dependence on the online gaming market, where it has a leading share. Many expect the pace of M&A activity among Chinese Internet names to pick up following Youku.com (YOKU) and Tudou's (TUDO) merger. | Mar. 14, 2012, 2:41 PM | Comment!
Sep. 23, 2011, 3:42 PMYouku.com (YOKU +22.1%) rebounds sharply from yesterday's decline, after Susquehanna's Ming Zhao upgrades the Chinese video site to Positive and sets a $29 PT. Zhao sees Youku as a likely acquisition target, and names China Mobile (CHL) and Tencent (TCEHY.PK) as potential buyers. (previously) | Sep. 23, 2011, 3:42 PM | Comment!
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