Nov. 11, 2013, 4:01 PM
- On China's biggest annual online shopping day (Singles Day), Alibaba handled RMB35B ($5.7B) worth of transactions, easily topping the company's $5B forecast. Alibaba's 2012 transaction level of $3.1B was passed at 1:04PM local time.
- Mobile sales rose over 5x Y/Y, and account for 21% of this year's transactions.
- Investors in 24% Alibaba owner Yahoo (YHOO +2.1%) appear happy with this year's performance. So do investors in 35% owner SoftBank (SFTBF, SFTBY), whose shares rose 1.9% overnight in Tokyo.
- Local e-commerce firm Dangdang (DANG +10.8%) has received a big lift from Singles Day optimism. Peer Vipshop (VIPS -2.1%), which is about to report, hasn't been so lucky. Oppenheimer has cut shares to Hold, citing lofty multiples following a big 2013 run-up. LightInTheBox (LITB -0.4%), which had its PT lowered by Oppenheimer, has closed down slightly.
Oct. 21, 2013, 2:35 PM
- In a move that could pave the way for a U.S. IPO, Alibaba has received approval from the NYSE (NYX, ICE) and Nasdaq (NDAQ) to maintain management/founder control of its board, should it list on one of the exchanges. Hong Kong's unwillingness to agree to the same had led the Chinese e-commerce giant to pursue a U.S. listing.
- Alibaba, whose Q2 numbers were released last week by 24% shareholder Yahoo (YHOO +1.8%), will likely have a $100B+ IPO valuation, given the current multiples being assigned to U.S. and Chinese Internet names. That means its offering could exceed Facebook's in size, and will easily dwarf Twitter's.
Oct. 18, 2013, 12:29 PM
- SoftBank (SFTBF.PK +0.3%) invests $1.26B in mobile device/accessories distributor Brightstar, valuing the company at an enterprise value of $2.2B. In conjunction, the Softbank, Sprint, and Brightstar Buying & Innovation Group joint venture will become a division of Brightstar.
- The investment aims to be a pricing power win-win as Brightstar becomes the exclusive provider of handsets, accessories, and services to certain SoftBank telco affiliates. Brightstar plans to purchase over $20B in devices/accessories. The move could reduce procurement expenses at Sprint (S -1.5%), in which SoftBank owns an 80% stake.
- Over the next 5 years, based on certain contingencies, SoftBank's ownership will accrete to 70%, from 57% today. Brightstar founder Marcelo Claure holds the remaining 43% of the company.
- Previous: SoftBank acquires 51% stake in Supercell for $1.5B
Oct. 15, 2013, 9:50 AM
- SoftBank (SFTBF.PK -0.2%) acquires a 51% stake in Finnish online game company Supercell for ~$1.5B, DealBook reports. The game maker will use proceeds to expand in Asian countries, including Japan and South Korea.
- Supercell intends to utilize SoftBank's "strategic resources [to] help us deliver our games to hundreds of millions of new consumers all over the globe," said founder Ilkka Paananen.
- Japanese game maker GungHo Online Entertainment, which is partially owned by SoftBank and already collaborates with Supercell, will invest $300M, or 20%, of the stake.
- SoftBank is aiming to gain a larger foothold in the mobile gaming market, which stands to benefit from enormous data usage tailwinds. Supercell's Clash of Clans and Hay Day are reportedly generating $2.4M in revenue a day.
Oct. 11, 2013, 4:06 AM
- Alibaba reportedly intends to carry out its IPO in 2014, although there is a smaller chance that it could file for a listing before the year-end.
- The speculation comes after Alibaba decided not to go public in Hong Kong, due to authorities not allowing the e-commerce giant to retain a structure that would enable its "partners" - a group of founders and senior employees - to maintain control of the board's composition.
- Previous reports have said Alibaba, whose shareholders include Yahoo (YHOO) and Softbank (SFTBF.PK), is moving towards a U.S. IPO.
- Meanwhile, Alibaba has reportedly provided most of the funding in a $206M round for ShopRunner, which competes with Amazon by offering an unlimited two-day shipping service from retailers for a yearly fee of $79. Under the deal, eBay (EBAY) sold its 30% stake at a profit.
Oct. 10, 2013, 6:48 AM
- Alibaba Group has decided not to list in Hong Kong, CEO Jonathan Lu has told Reuters, as authorities "need time to study" a structure that would allow the Internet giant's "partners" - a group of founders and senior employees - to maintain control of the board's composition. In other words, the authorities won't allow it.
- However, Alibaba hasn't decided on which exchange it will list - it has been speculated that the company will IPO in the U.S.
- Any flotation could raise an estimated HK$100B ($12.9B) and value Alibaba at up to $120B. That would be a boon to Yahoo (YHOO) and Softbank (SFTBF), which own 24% and 35% respectively.
Oct. 1, 2013, 12:56 PM
- SoftBank (SFTBF.PK) founder Masayoshi Son on Sprint (S +2.3%): "It takes time to get devices ready and prepare services and the network ... At the very least you need half a year or a year. And for anything substantial you need one or two years."
- Sprint investors are hoping Son can work some of the magic he worked in Japan, where a share-losing/also-ran Vodafone unit was transformed into a major share-gainer following its acquisition by SoftBank.
- However, many on the Street are on edge over recent share losses, Sprint's new (aggressively priced) service plans, and heavy 4G capex. After talking with management, New Street Research's Jonathan Chaplin recently forecast Sprint will lose 1.2M subs in 2014; he previously estimated the carrier would add 100K.
- Yesterday: Kantar's June-August smartphone sales estimates
Sep. 30, 2013, 12:14 PM
- A banking source tells BI's Nicholas Carlson the banks working on Alibaba's IPO want the Chinese e-commerce giant to go public at a $100B valuation.
- If current valuations for high-growth Internet names hold up, there's a good chance Alibaba will end up being worth more than $100B. The company had Q1 revenue of $1.38B (+71% Y/Y) and net income of $669M. Facebook, currently worth $125B, had revenue of $1.81B (+53% Y/Y) and net income of $488M in its blowout Q2.
- Yahoo (YHOO), which rallied last week (I, II) thanks to Alibaba-related news, is near breakeven after opening lower. Citi raised its PT to $39 from $31 this morning, citing a higher valuation for the Alibaba stake and improving search trends.
- The firm now thinks Alibaba can deliver 2014 revenue of $10B and net income of $4.3B (up from a prior $9.7B and $4B), and believes Yahoo will be able to at least partly sell its 24% stake (valued at $16/share) in a "tax-efficient" manner.
- Citi also observes comScore estimates Yahoo saw 22% Y/Y search paid click growth in August. Yahoo, whose search revenue per query has long trailed Google's, saw 21% paid click growth in Q2, partly offset by an 8% drop in cost per click.
Sep. 27, 2013, 9:42 AM
- In a move that brings Alibaba one more step closer to a U.S.IPO filing, 24% shareholder Yahoo (YHOO +1.2%) and 36.7% shareholder SoftBank (SFTBF.PK) have given their blessing to a corporate structure that would allow its 28 partners (largely founders and management) to maintain firm control of the Chinese e-commerce giant's board (and which didn't sit well with Hong Kong regulators).
- Alibaba vice chairman Joe Tsai has written a blog post defending his company's planned partnership structure. Echoing arguments made by Google and Facebook regarding their dual-class share structures, Tsai asserts tight partner control will "help maintain the Alibaba culture."
- Yahoo is outperforming following the news. SoftBank rose 1.6% overnight in Tokyo.
- Yesterday: Yahoo rallies as Alibaba IPO reportedly draws closer
Sep. 26, 2013, 12:58 PM
- With Alibaba apparently set to list in the U.S. following a breakdown in talks with Hong Kong regulators, 24% owner Yahoo (YHOO +4.6%) is adding to its 2013 gains, and in doing so hitting levels last seen in '07.
- Reuters reports Alibaba "has engaged U.S. law firms to start working on its IPO and will soon be hiring banks to manage the listing."
- Alibaba's very strong Q1 numbers, together with the huge rallies seen this year in high-growth Chinese and U.S. Internet names, has fueled hopes of a post-IPO valuation soundly above $100B.
- 36.7% Alibaba owner SoftBank (SFTBF.PK) rose 4% overnight in Tokyo.
- Previous: ABR assigns Alibaba a $100B post-IPO valuation
Sep. 26, 2013, 12:09 PM
- "I think we're still open to look at opportunities that make sense for both sides," says Sprint (S +0.9%) CFO Joe Euteneuer at a Goldman conference talk, responding to a question about whether Sprint is willing to do a network-sharing deal involving 3rd-party spectrum.
- Dish (DISH +0.2%), which has a large chunk of 4G spectrum and hasn't decided yet what to do with it, reportedly held talks with Sprint at one point about a network-sharing deal. But deal speculation has died down in recent months, following Dish's failed attempts to wrest Sprint/Clearwire from SoftBank (SFTBF.PK).
- Euteneuer also reiterated Sprint plans to have its 4G LTE network cover 200M people by year's end, and says the #3 U.S. carrier will use Clearwire's 2.5GHz. 4G TD-LTE spectrum (good for urban areas) at all of its 38K planned LTE cell sites. He adds the Clearwire spectrum gives Sprint "a lot more runway" to support its unlimited data plans (now guaranteed for life).
- Yesterday: T-Mobile CFO says Sprint merger makes sense
Sep. 25, 2013, 11:40 AM
- During a Goldman conference talk, T-Mobile USA (TMUS +2.3%) CFO Braxton Carter called a merger between his company and Sprint (S -2.3%) the "logical ultimate combination." But he also admitted the current M&A regulatory environment is "tough."
- T-Mobile and Sprint have been bleeding share in recent years to bigger rivals Verizon and AT&T. However, T-Mobile has begun to reverse its fortunes with the help of an iPhone deal, contract-free plans, and its Jump smartphone upgrade program. Sprint is betting aggressive pricing and a rapid 4G buildout will help it do the same.
- Regulators may not be the only reason a T-Mobile/Sprint deal would be challenging in the near-term. T-Mobile is in the midst of digesting MetroPCS, and Sprint is fresh off acquiring Clearwire and merging with SoftBank (SFTBF.PK).
- Separately, SoftBank has extended Sprint CEO Dan Hesse's contract through July 2018.
Sep. 25, 2013, 2:50 AM
- Alibaba reportedly plans to carry out its blockbuster IPO in the U.S. after negotiations with the Hong Kong stock exchange broke down over the e-commerce giant's demand that its "partners" - a group of founders and senior managers - maintain control over the composition of the board.
- Listing in New York would allow the partners to keep their grip of the company due to the possibility of creating a dual-class structure where one set of shares provides more voting rights than another.
- Alibaba has hired U.S. law firms to start working on the listing and intends to soon appoint banks.
- The IPO could raise an estimated HK$100B ($12.9B) and value Alibaba at up to $120B. That would be a boon to Yahoo (YHOO) and Softbank (SFTBF.PK), which own 24% and 35% respectively.
Sep. 16, 2013, 12:17 PM
- The program, called Sprint One Up (S +0.1%), will reportedly launch on Sep. 20. It will allow Sprint subs to obtain a new smartphone for no money down and $27/month.
- Interestingly, they'll also get a $15/month discount on Sprint's Unlimited voice/text/data plan ($65 instead of $80). Users will be able to trade in their phones after a year. Existing subs who have been on contract for a year or longer will be eligible.
- In a leaked slide, Sprint asserts a One Up sub will pay $1,192 in total phone and service fees in the first 12 months, $228 less than a subscriber to T-Mobile USA's (TMUS +0.2%) Jump upgrade plan and over $500 less than subscribers to AT&T's (T +0.6%) Next plan or Verizon's (VZ +0.9%) Edge plan; AT&T and Verizon's early upgrade pricing has already been criticized.
- SoftBank (SFTBF.PK, SFTBY.PK) has promised Sprint will price its services aggressively going forward. Sprint overhauled its service plans shortly after the SoftBank deal closed, but the price cuts offered weren't as steep as some expected.
Sep. 16, 2013, 11:08 AM
- China Unicom (CHU +0.6%) says its iPhone 5S/5C (AAPL -2.6%) reservations have topped 100K since it began taking them last week. Last year, Unicom took 200K+ iPhone 5 reservations in the phone's first two days of availability.
- Meanwhile, China Telecom (CHA +2.5%) has cut its iPhone subsidies. A subscriber signing up for an RMB289/month ($47/month) plan will get an iPhone 5S subsidy of RMB2890, 15% less than the RMB3400 subsidy it provided for the iPhone 5. It's worth noting CHA's ARPU is below $10.
- The Chinese figures come amidst sharp criticism of the 5C's unsubsidized pricing, which starts at $735 in China. For reference, upstart Xiaomi's new Mi3 flagship Android phone (5" 1080p display, 13MP camera) starts at $327 in the Middle Kingdom.
- On the other hand, Japanese carriers are aggressively subsidizing the 5S in the wake of NTT DoCoMo's (DCM +0.7%) iPhone deal. DoCoMo, SoftBank (SFTBF.PK), and KDDI are each providing the 5S for free with 2-year contracts for certain plans.
- Kantar Japan recently estimated 2/3 of DoCoMo subs who have been leaving the carrier ended up buying an iPhone.
- Also: Bernstein thinks Apple could still come out with a cheaper iPhone in the form of a sub-$400 iPhone 4C that puts the iPhone 4's components inside a 5C body.
Sep. 5, 2013, 2:25 PM
- The Japanese paper says DoCoMo (DCM +1.1%) is likely to announce a partnership with Apple (AAPL -0.8%) on the day of its iPhone launch. Apple has announced an iPhone satellite event will take place in Tokyo (along with ones in Beijing and Berlin) hours after its main Sep. 10 event in Cupertino.
- A DoCoMo EVP suggested last month a deal could be close. Previous talks between Apple and DoCoMo reportedly faltered due to Apple's purchase requirements and DoCoMo's insistence on pre-installing some of its apps.
- DoCoMo, by far Japan's largest carrier (60M+ subs, 1/4 of which are now using 4G phones), has been losing share to SoftBank (SFTBF.PK) and KDDI in large part due to its failure to carry the iPhone. Though DoCoMo's sub base is much smaller than China Mobile's 740M, a much larger portion of it can afford a $450+ (unsubsidized) phone.
- Japan is the iPhone's strongest major international market. Thanks largely to iPhone sales, Apple's Japanese revenue rose 27% Y/Y in FQ3 to $2.5B, even as revenue fell 14% in Greater China and 18% in the rest of Asia-Pac.
- Update: Bloomberg reports Apple is "near a final agreement" with DoCoMo, and that the carrier "may begin offering the iPhone later this year."
- Update 2: Reuters has joined the fray.
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