China news / analysis in brief

Details:

• According to Barron's (subscription required), WM Wrigley (ticker: WWY) is close to completing the acquisition of
  Joyco. Joyco has a strong
  position in several European chewing-gum markets, and is No. 1 in India
  and China, each of which have huge growth potential.

• According to an article from Xinhua, three major issues need to be resolved before 3G can be introduced. The government must determine how to reform the telecom industry, a number of patent disputes need to be cleared up, and the maturity of TD-SCDMA must be tested.

• The9's (ticker: NCTY) online game World of Warcraft (WoW) launched for commercial purposes on June 7th. This follows a hugely successful open beta test that began in April. Read what Shanda Interactive (ticker: SNDA) said about WoW in its latest earnings results conference call here.

• China search engine company Baidu.com will reportedly go public on Nasdaq in July and raise up to $300 million. The deal will be underwritten by CS First Boston and Goldman Sachs.

• China is to release a set of new rules to vet the content of online games as part of a campaign to combat what it sees as harmful influences on young people. Under new rules drawn up by the Ministry of Culture and the Ministry of Information Industry to be released in June, game manufacturers are required to revise game rules that might lead to addiction.

• Exports of mobile phones from China totaled 53.11 million units and were valued at $5.04 billion in the first four months of 2005. These figures demonstrate an increase of 31.2% in volume and 31.6% in value from a year earlier.

• General Motors (ticker: GM) and one of Volkswagen's two China ventures posted solid year-over-year sales growth for the first five months of 2005. However, analysts are skeptical that this is a sign of a recovery for the Chinese auto market. More here.

• China's steel mills are deferring shipments of iron ore from Australia and Brazil after sharp falls in domestic steel product prices, according to an industry source and a trader in Hong Kong. They said the price declines in the past few weeks had destroyed confidence in the Chinese sector, which saw crude steel output jump by about 25% in the first four months of 2005 despite the government's measures to cool the sector's growth. Industry sources and traders said the sentiment in the mainland steel industry had changed completely from the first quarter as the government appeared determined to slow down the rapid expansion of the energy-intensive sector.