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International brand acquisition by Chinese companies

International brand acquisition by Chinese companies

In recent years, Chinese investors have significantly increased their foreign investment activities especially in the form of cross-border mergers and acquisitions (M&As). Chinese companies now own part or all of a number of international companies that might not be immediately apparent. Whether you’re going to the movies, washing your clothes or going for a drive there’s a good chance you're trading with a Chinese company. 

 

For many Chinese firms, foreign acquisitions are also a way to ensure access to customers or key suppliers, in particular of raw materials. The debate on Chinese foreign M&A activities, however, is mostly based on speculations and anecdotes. Despite a growing number of studies on Chinese overseas investment, there is surprisingly little systematic evidence on whether Chinese cross-border M&As differ from investment coming from other countries

 

Here’s a look at some of the bigger business names that are owned by Chinese companies:

 

 

GE Appliances

In 1982, General Electric got its start as a pretty small brand. It has since grown at an exponential rate, however. It now dabbles in many other industries from healthcare to aviation to venture capital to power. This is one of those brands that feel very homegrown, partly thanks to the “Made in America” stamp on the products. But the truth is that it has been owned by a Chinese company called Haier ever since 2016. GE was purchased for $5.4 billion, which is definitely on the high end of things. Even though the products continue to be made in the United States, the decisions are ultimately made in China.

 

AMC

For about an entire century, AMC cinemas have been giving movie lovers relaxing and fun moviegoing experiences. This company made a name for itself in this industry and even went on to be the biggest movie theatre chain on the planet. Even though the initials stand for American Multi-Cinema, the truth is that a Chinese company called Dalian Wanda Group had been the majority stakeholder from 2012 to 2018. In 2018, however, this changed a bit after Silver Lake Partners bought a $600 million stake in it. Despite this, Wanda Group is still the one who gets to call the shots in terms of executive-level decisions.

 

Motorola

Best known for its tech products, Motorola started in Schaumburg, Illinois a long time before we were even introduced to the concept of mobile phones. After it was launched in 1928, it saw steady growth until it reached the peak of its success with flip phones and the like. Google eventually bought it, only to sell it to a Chinese company called Lenovo in 2014. This did not prove to be a profitable move for Google since it bought the company for $12.billion two years before it sold it for $2.9 billion. Even today, people are still puzzled why Google seemed to be comfortable losing $10 billion with this deal.

 

IBM (PC Division)

Ever since it was founded in IBM, this company has helped the United States stay on top when it comes to tech. In those days, it was more involved in business machines more than computers. IBM has a truly fascinating past, to say the least. In 2004, Lenovo bought its PC division for $1.75 billion. “As Lenovo’s founder, I am excited by this breakthrough in Lenovo’s journey towards becoming an international company,” shared Chuanzhi Liu, who was the CEO of Lenovo back then. On the other hand, IBM CEO Sam Palmisano shared his thoughts by saying, “Today’s announcement further strengthens IBM’s ability to capture the highest-value opportunities in a rapidly changing information technology industry.”

 

Legendary Entertainment Group

After Dalian Wanda Group bought AMC and saw great success in the movie industry, it decided to go all in by buying a movie studio in 2016. Legendary Entertainment Group turned over its ownership to the Chinese company in a deal worth $3.5 billion. At the time, Dalian Wanda Group wanted to absorb it into its existing portfolio. However, it eventually reached the decision to just operate it as it was. It has been four years since the purchase, so let us take a look at how things are going for LEG. Ever since the acquisition, it has produced movies such as Jurassic World: Fallen Kingdom, Pacific Rim: Uprising, Kong: Skull Island, and Skyscraper!

 

Hoover US

Ever since it opened its doors in 1908, Hoover has made a name for itself as a trusted American appliance brand. Named after founder William Henry Hoover, the company is now considered to be an iconic brand. Even though things remained local for the longest time, things changed after Techtronic Industries bought it for $107 million in 2006. You will still find the HQ in North Carolina, but the central office is now in Hong Kong. The Chinese company is huge with a staff of more than 30,000 members and yearly sales of more than $7.7 billion. While it is no longer an American company, it is in good hands.

 

General Motors

General Motors holds the title of the largest automobile manufacturer in the United States.  It is one of the largest companies in the industry in the whole world, so it is a very appealing and profitable business. Even though it is not completely owned by Shanghai Automotive Industry Corp, it still relies on the Chinese company to keep money coming in. The two companies started a joint venture back in 1998. Customers might not know it, but SAIC sells cars by using the General Motors name. At any rate, they are two separate companies as the SAIC HQ is in Shanghai, whereas the GM one is in Detroit.

 

MG Motors

MG Motor UK Limited (MG Motor) is a British automotive company headquartered in London, United Kingdom, and a subsidiary of SAIC Motor UK, which in turn is owned by the Shanghai-based Chinese state-owned company, SAIC Motor. MG Motor designs, develops and markets cars sold under the MG marque, while vehicle manufacturing takes place at its plants in China, Thailand, and India. Its fourth factory in China, in Ningde, Fujian Province, specialise in producing electric vehicles, with the new all-electric production sports car being produced at the factory. The design of new cars has been retained at Longbridge where Research and Development is currently undertaken

 

The Waldorf Astoria Hotel

When it comes to luxury accommodation, the Waldorf Astoria Hotel is a great choice. It is not just an institution in New York, but it is also a part of history in the United States. While Hilton Worldwide manages the hotel, Anbang Insurance Group bought it for $1.95 billion in 2014. This unbelievable price makes it the most expensive hotel in history. The Chinese company made huge changes to the hotel and turned a chunk of its rooms into condos. The insurance company is also interested in buying even more American businesses. One of the properties that it had been looking at would be Starwood Resorts.

 

Smithfield Foods

This $7.1-billion-dollar deal, completed in 2013, remains the largest purchase of an American firm by a Chinese company. Virginia-based Smithfield Foods has been an icon of the American food industry and is best known for its hams (especially its holiday ham). The deal spurred controversy and concern at the time, but Smithfield has thrived, adding jobs and hitting a sales records.

 

WeWork

WeWork took advantage of the rapid growth in shared work spaces  when it was launched a decade ago. It now manages more than 4 million sq. m. of space! However, it went through a pretty rough patch and needed more capital in 2016. That was when a Beijing-based company called Legend Holdings Corp. became a “new partner” and poured more than $430 million into the company. John Zhao of Legend Holdings Corp. even went as far as to say, “Our investment in WeWork is both strategic and obvious.”

 

Segway Inc

A few decades ago, people would have thought that the idea of whizzing around on two wheels was something straight out of a sci-fi film. Segway Inc. has proven to us that this can be done in real life as well. A Beijing-based company called Ninebot bought the transportation company for $80 million in 2015. Things have only gotten better for Segway since then because the Chinese company helped it attain a larger foothold in the world of tech and robotics. In 2018, the company announced that it was planning to move its production sector from New Hampshire to China. However, it eventually took it back to say that the majority of production was going to remain in Bedford.

 

Riot Games Inc

Anyone who plays the multiplayer online gaming phenomenon League of Legends will be familiar with Riot Games. Released in 2009, the game went on to accumulate a large following and became the best-known product of the company. Even though Riot Games has been working with Tencent for a long time already, their partnership reached its peak in 2015. The Chinese company purchased the rest of the stakes and became the parent company of Riot Games. Before this happened, it already owned 93% of the gaming company. With this in mind, we are under the impression that the new development was already a given. The value of Riot Games is said to be $6 billion.

 

And In a reverse of ownership

 

 

Volvo Cars

Volvo Cars has struck a deal to buy out parent company Zhejiang Geely Holding (GEELY.UL) from their joint ventures in China. Taking full control of the Chinese joint ventures could help smooth the way for a Volvo Cars IPO as the country's requirement for auto manufacturing to be carried out with a local joint venture partner is lifted next year.

Volvo Cars has grown significantly faster than the average market in China in recent years and will continue to invest in the country to maintain the strong growth trend. Following the transactions, Volvo Cars will have full ownership of its manufacturing plants in Chengdu and Daqing, its national sales company in China and its R&D facility in Shanghai.

Volvo Cars has seen strong growth in the Chinese market in recent years. In 2020, it sold 166,617 cars in China, an increase of 7.5 per cent versus 2019 and its eighth consecutive sales record in the market.

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JD Health, Digitalizing health care...

JD Health, Digitalizing health care in China
JD.com is perhaps known best as the biggest online retailer in China, with an extensive logistics network that can reach all corners of China. But the tech giant is much more than that. The JD ecosystem contains JD Logistics, JD Technology (formerly JD Digits) and JD Health. The latter is now the largest retail pharmacy in China, sitting on more than 15% of the total market share and growing on average four times as fast as its competitors. JD Health provide round retail pharmacy services and round the clock health care services via in-house doctors and external partners.
 
 
 

 

 

Pharmacy retail on speed

Imagine that you can get your medicine delivered in 30 minutes. That is the reality and the norm in China´s largest cities now. Only a few years ago, this was not possible. JD Health officially sold its first pharmaceutical product online in 2013, and since then the business have taken off. With more than 14 drug warehouses and over 300 other warehouses nationwide, JD Health can deliver medicine from over the counter to prescription drugs fast and easy for its users. They launched a “Family Medicine Kit” service which provides families a one-stop health care management service platform offering drug recommendations, health knowledge sharing and pharmaceutical after-sales services. It is linked with JD´s insurance business team and JD Logistics and offers replacement services for expired drugs.

But JD Health also cover B2B, as they aim to build the complete retail ecosystem. For drugstores in China’s rural areas in fourth tier cities, it has long been a struggle to compare medicine prices, incomplete variety of drugs and long procurement times. JD’s marketplace has an extensive range of products, ranging from OTC (over the counter) drugs to medicine for chronic diseases, medical equipment, and nutritional products.

 

 

 

Consultations online

In China, primary care such as family doctors and general practitioners is not commonplace, and people must go to a hospital for serious illnesses or a community clinic for less complicated issues. This creates extremely long lines, waiting times and uncertainty for those who do not live near hospitals. Therefor telemedicine is high on the national agenda, and the central government has over the past many years launched several key policy documents like “Healthy China 2030” outlining the priorities for commercial players to tap into. JD Health was the first company to offer both retail pharmacy and online health care services, and in 2020 JD Health launched a family-doctor service. It is an annual subscription service, that can cover a family unit of up to eight people, who can get quality care, monitor health conditions of family members afar and access online and offline consultations. Online consultations were on the rise before Covid-19, but the pandemic made the number of users explode, and surveys show a significant increase in citizens willing to accept online consultations for basic issues as well as long term health conditions.

 

 

An expanding ecosystem

The ambition for JD Health is to build a closed loop ecosystem, making it possible for patients to have easier access to better health care, no matter their geographical location. As the retail pharmacy business is growing and profitable, it is less so in general with online services. However, experts and investors in the area expect to see this become profitable in 5-10 years. The overall strategy of the closed loop system is also to drive traffic from patients on the online pharmacy platform to the health management services, and in turn drive traffic back to the retail pharmacy business. JD Health has a clear advantage in its extensive logistics network and advanced cold chain supply chain capabilities as well as its services in finance and insurance.

 

Didi raises $4 billion in US listing...

Didi raises $4 billion in US listing. Updated for data-security probe.


China's ride hailing company Didi Chuxing raised about $4 billion in its IPO on the New York Stock Exchange (NYSE), priced at the top range. Based on the listing, Didi's market valuation will hit a record $67 billion. 



Under the IPO Didi issued 288 million American Depository Shares (AD), priced at $14 each, equivalent to 72 million shares of Class A common stock on the NYSE.



It is the largest IPO by a Chinese firm in the US stock market since 2014 when Chinese internet behemoth Alibaba earned the title of the biggest IPO. It is also likely to be the largest IPO in the US market this year.



According to the company, 30 percent of the funds raised with the IPO will be used to expand international business outside China. Another 30 percent will go to enhance current technologies, and 20 percent will be on improvement of user experience. 



Founded in 2012, Didi has launched operations in 14 countries outside China, hiring thousands of local employees across Africa, Asia-Pacific, Europe and Latin America. The company has consolidated a strong market position as one of the most popular ride-hailing platforms in Latin America and the second largest ride-hailing and food delivery platform in Mexico, in terms of total transactions in 2020, according to the China Investment Corporation and iResearch Consulting Group.

 

DiDi Headquarters in Beijing.


Didi's global platform provided services to over 493 million annual active users and managed an average of 41 million daily transactions for the previous 12 months ending on March 31, 2021, according to the listing prospectus.



In 2020, Chinese companies raised $12 billion from US listings, more than triple the funds raised in 2019, according to data from Refinitiv.



As of May 5, a total of 248 Chinese companies were listed on major US stock markets including NASDAQ and NYSE, up from 217 on October 2 last year, according to a report released on May 13 by the US-China Economic and Security Review Commission. During that period, 17 Chinese companies, including chipmaker SMIC and the China National Offshore Oil Corp, were delisted from US markets.

 

5th July Update:

Didi Chuxing has warned about the impact of a clampdown on its business just days after a US$68bn float on Wall Street. Chinese authorities warned the ride-hailing firm on Friday they were investigating the business and on Sunday banned it from app stores.

 

Didi, which operates predominately in China where it organises 20mln journeys daily, has been accused of illegally using personal data gathered from customers. China’s Cyberspace Administration (CAC) said: "After checks and verification, the Didi Chuxing app was found to be in serious violation of regulations in its collection and use of personal information. The ban means Didi will not be allowed to sign up new users, though existing customers can carry on using the app as normal.

 

In a statement, Didi said: "The company will strive to rectify any problems, improve its risk prevention awareness and technological capabilities, protect users' privacy and data security, and continue to provide secure and convenient services to its users.

 

Didi's shares fell by 5% on Friday to US$15.53

 

The float was the biggest Chinese listing in the US since the 2014 float of Alibaba and saw the company raise US$4.4bn in new money to fund overseas expansion plans.

 

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3 Trees Group, an Olympic Sponsor

3 Trees Group, an Olympic Sponsor

Sankeshu Paint will serve as the official exclusive paint supplier of the Beijing 2022 Olympic and Paralympic Winter Games. Established in 2003 Sankeshu is part of the Three Trees Group.

 

 

Chairman and President of Three Trees Hong Jie, says his company's mission of “making homes healthier and cities more beautiful” connects with Beijing 2022’s concept of “delivering a green Olympic Winter Games”. Sankeshu becomes the seventh official exclusive supplier for Beijing 2022. We have a look at company below:

 

 

SKSHU Paint Co., Ltd. (“3TREES”) has been committed to building healthy homes by providing an integrated 6-in-1 one-stop system of green construction materials and services, encompassing interior and exterior wall coatings, waterproofing products, insulation materials, auxiliary materials, floor coatings and construction. 3TREES went public on the A-share Main Board of Shanghai Stock Exchange in 2016, being the first national paint company that issued stocks. The brand value was worth 23.985 billion yuan in 2019 and became a coating enterprise among the "Top 500 Private Enterprises in China". Headquartered in Putian, Fujian Province, has a center in Shanghai and has or is constructing 9 production bases in Sichuan, Henan, Tianjin, Anhui, Hebei, Guangdong, Hubei and other places, 3TREES is now an enterprise group with 20 wholly owned or controlling companies.

 

 

Company Snapshot for SKSHU Paint Co., Ltd.

  • EMPLOYEES (All Sites): 3,899
  • ASSETS (MIL USD): 807
  • REVENUE (MIL USD): 848.84
  • TICKER SYMBOL: 603737
  • FISCAL YEAR END: DEC
  • SALES GROWTH %: 66.64%
  • NET INCOME GROWTH: 82.55%
  • ADDRESS: 518 Liyuan North Avenue Licheng District Putian, 351100. China

 

 

Key Company personel

  • Jie Hong, Chairperson
  • Dedian Lin, Director
  • Guoqin Fang, Director
  • Lizhong Lin, Director

 

 

Its international website is found at https://www.3treespaint.com and China website at https://www.skshu.com.cn

As one of the top 30 paint manufacturing enterprises in the world, the company heavily promotes its  ecological culture, green brand and healthy products from a modern eco-friendly plant.

LeEco, China`s new tech giant

LeEco, China`s new tech giant

When people talk about China’s tech scene, there are the obvious giants: Baidu, Alibaba, and Tencent. Then there are the big state-linked firms (the telecoms, Huawei, and ZTE), the internet players (Sina, Qihoo), and the hot mobile startups (Xiaomi, OnePlus). But there’s a Chinese company that often doesn’t get mentioned as one of the big names: LeEco formerly LeTv.

 

 

 

Just a couple of years ago it primarily operated a streaming video site. But as its popularity grew, Letv (over 50 million daily users & over 730 million active monthly users) has rebranded into LeEco and branched its business out aggressively in numerous directions: it now operates 7 Ecosystems. The company now makes smartTV`s as well as smart phones and smart bikes. And a whole range of other smart devices and electronics. It has a cloud computing division. It offers internet finance products. It’s working on a smart electric car. It now has a music division (Le Music), a film division (LeVision Pictures), and a sports division (LeSports). What was once just an internet video company has branched out into a multi-armed technology and entertainment company.

 

 

Le Holdings and Its Seven Business Ecosystems

 

Recently, LeEco has been taking a different tack: splashing cash to acquire a wide variety of companies. In late spring, LeEco spent almost US$500 million buying two Chinese real estate companies so that it could expand into that space. Just a few weeks ago, it bought US TV maker Vizio for US$2 billion. This week, it was confirmed that the company has nabbed a bigger chunk of Chinese smartphone maker Coolpad. It was also confirmed recently that LeEco is working on some sort of deal with Netflix (at the end of last year Letv marked another milestone in its globalization - Le Super TVs started to be sold in the US). At present, Le Eco has been officially established in the US, India, and Hong Kong and the "Beijing-Los Angeles-Silicon Valley" strategy has proved hugely successful from its conception.

 

 

There are genuine questions about some of LeEco’s funding habits, and whether or not the company can sustain its breakneck pace of expansion that it has been keeping up over the past several years. But with a market cap of more than US$13 billion, LeEco is already bigger than some of China’s most storied internet and tech companies.

 

 

LeEco is both polarizing and opaque: some think the company is one of China’s most innovative and exciting tech firms, however until some of LeEco’s bigger projects – like that smart electric car come to fruition it will be difficult to judge whether their expansion has been thought out.

 

 

LeEco is now a major player in China’s tech scene, with the ability to influence industry sectors ranging from streaming video to smartphones to autonomous vehicles. LeEco certainly hasn’t overtaken any of China’s true giants – it’s not yet on the level of a Tencent or an Alibaba. But increasingly, it can be argued that LeEco deserves a spot at the table, and a place in the conversation.

 

 

LeMall is ranked among the top three B2C e-commerce websites in China

 

 

 

Alibaba, the future is Aliyun

Alibaba, the future is Aliyun

At the start of the year Alibaba announced that they had crossed the RMB 3 trillion mark in gross merchandise volume (in excess of $450 billion USD). Founder and CEO Jack Ma has now announced that the company's dream is to reach 2 billion people around the world with his business and hit a transactional volume of $1 trillion. That would make them the equivalent of being the fifth largest country in the world by GDP.

 

 

Overview.

China's e-commerce market is dominated by Alibaba. Though the company operates through a unique combination of business models, Alibaba's core business resembles that of eBay. Alibaba acts as a middleman between buyers and sellers online and facilitates the sale of goods between the two parties through its extensive network of websites. The largest site, Taobao, operates as a fee-free marketplace where neither sellers nor buyers are charged a fee for completing transactions. Instead, the nearly 7 million active sellers on Taobao pay to rank higher on the site's internal search engine, generating advertising revenue for the company.

 

 

While the majority of sellers utilizing the Taobao website are smaller merchants, Alibaba also has a dedicated space for larger retailers: Tmall is the e-commerce site owned and operated by Alibaba that caters to well-known commercial brands that would normally operate on the high street. Even though Tmall has a fraction of the number of active sellers listed on Taobao, Alibaba is able to generate revenue from deposits, annual user fees and sales commissions charged to retailers utilizing the site.

 

 

In addition to its e-commerce sites, Alibaba has emerged as a player in the Chinese financial system. To combat customer concerns over the security and validity of transactions completed online, Alibaba created Alipay. As a secure payment system, Alipay protects buyers in the event sellers are unable or refuse to deliver goods sold. In addition to this platform, Alibaba also generates revenue from its newly launched micro-lending business arm that caters to individual borrowers.

 

 

The Alibaba Marketplaces

Alibaba's marketplaces are obviously their core revenue streams. As such, these will be the biggest drivers of growth. As of the most recent quarter, Alibaba had 423 million annual active buyers and 410 million monthly active users and transactional volume for the quarter was $115 billion - a 24% increase over the same quarter last year.

 

 

However the Chinese market is yet to be fully penetrated, by their own estimates they currently only reach about 55% of potential consumers. Furthermore it still does not have enough traction in international markets to claim the kind of long-term growth that they would require to become a truly global household name.

 

 

The future is Aliyun.

The next growth driver for the company is a brand that many do not recognise, but is nevertheless growing at a tremendous rate that may one day outdo its rivals: the cloud and specifically Aliyun Cloud. With data centers around the world having a first quarter of 2016 growth of 175% it is definitely a growing entity which Alibaba is well positioned to grow in part due to preferential government policy, regional focus and domain expertise. Aliyun certainly has the potential to become one of the growth drivers of Alibaba's future considering it currently accounts for less than 2% of its revenue.

 

 

Outlook.

The entire global market is potentially at their doorstep, not only for marketplace services, but also cloud capabilities. Not forgetting their other web and content properties like UCWeb with 400 million users, content distribution platform Youku Tudou (newly acquired) and web payment service Alipay, which has 400 million registered users and a transaction volume of $519 billion (as of 2015).

 

 

 

 

Goodbaby: baby boom

Goodbaby: baby boom

Established in 1989, Goodbaby Group is China's largest and the world's leading provider of infant and children's products such as strollers, car seats and child safety devices. Goodbaby is a professional production, manufacturing and design company with customers located in more than 70 countries and regions worldwide. According to a survey from Frost & Sullivan, in each sale of 1000 baby carriages in North America, Europe and China, 435 come from Goodbaby Group. In 2007, Goodbaby Group was listed as one of the `Top 50 Fastest-growing Companies in the World' by Boston Consultancy. Currently, the company owns four global R&D centers, 11 subsidiaries, has 35 branch offices and more than 13,000 employees worldwide.

 

 

Today they have over 3,200 stores in China, including multi-brand children's shoe stores, Mothercare shops and baby superstores, but this number is due to grow to 7,000 to 8,000 in the next few years in the wake of the relaxation of the One-Child-Policy.

 

 

The group has another listed company: Goodbaby International Holdings Ltd, which was floated on the Hong Kong stock market in 2010. It focuses on baby-care products design, production and sales, while Goodbaby China will sell those products in its network of shops.

 

 

Analysts believe China has more than 16 million to 17 million babies born each year adding that baby-related products had in recent years triggered a billion dollar market estimated $46.5 billion in 2016, involving both Chinese and Western players who needed to understand each market's specific needs.

 

 

To capture this opportunity Goodbaby launched a stroller called Pockit, able to be folded and carried onto passenger planes, which became an international best-seller. The group added two further brands it acquired in 2014: Germany's Cybex and US brand Evenflo. In particular to capture, the market for medium and high-end baby products.

 

 

Amongst Goodbaby`s leading competitors are:

Combi (Shanghai) 

Pigeon 

Procter & Gamble (China) Ltd. 

Zhejiang Beingmate Scientific Industrial Trading 

 

 

Hanergy Solar Group (2016 Update)

Hanergy Solar Group (2016 Update)

Beijing based Hanergy is China`s largest, privately owned, producer of renewable energy. The group operates in the hydropower, wind power and the solar power fields, whilst it`s focus has now shifted towards the latter, the company has become the largest thin film solar panel producer in the world and has a presence in Europe, North America and Asia-Pacific. The company was featured in the MIT Technology Review’s “50 Smartest Companies of 2014” ranking,  due to its almost 1000 patents, mostly related to photovoltaic innovation.

 

 

Currently Hanergy’s installed capacity for hydropower exceeds 6 GW, whilst the same figure for wind power stands at 131 MW according to the company’s reports. The company also has the world’s largest, privately built, power station, Jin’anqiao. Its Wind power plants are in Jiangsu and Ningxia provinces.

 

However, today, the core business and focus of the company is the development and production of photovoltaic panels. Hanergy has made striking progress in becoming a global leader in the field, considering it only started the development of its photovoltaic arm 5 years ago. Local media in Guangdong, province where Hanergy launched its solar panel operations, coined new term – “Hanergy speed”. The company claims its annual capacity for producing PV panels is now over 3 GW, which would translate to 4 billions kWh of electricity annually. The group has signed construction agreements for solar power plants with a 4 GW total capacity in Inner Mongolia, Ningxia, Jiangsu, Hainan, Shandong, Hebei and other provinces, as well as in several European countries.

 

Hanergy focuses on thin film photovoltaic solar panels. Production line start-up costs are relatively high whilst efficiency is lower than traditional silicon panels, but the lower production costs and consistently improving transformation rate should increase thin film panels commercial attractiveness. Over supply in the solar industry forced numerous companies out of business, some of which were rescued by Hanergy Solar Group (HNS), in which Hanergy Group acquired a controlling stake in February this year.

 

Hanergy Group and Hanergy Solar Group have been aggressively expanding in both the domestic and international markets. It recently signed a partnership with IKEA, where it will furbish its retail stores with solar panels in the UK and China. Furthermore, by acquiring MiaSole and Global Solar Energy in the US and Solibro in Germany it has significantly strengthened its R&D capacity The latter has been working on improving conversion efficiency of Copper Indium Gallium and Selenium (CIGS) panels since the acquisition, with highest efficiency rate of patented panels being 15.5% conversion, while the latest lab tests are reaching 19.6% conversion: meaning about a fifth of sun’s radiation is being converted into electricity. Moreover, Hanergy has signed an agreement with Aston Martin Racing, and will explore possibilities of solar technology application in motorsports.

 

 

However, despite all positive news, Hanergy’s future plans seem to be both risky and reliant on Governmental patronage. The group’s investments into wind and solar farms are only 30% - 40% funded by the Hanergy itself, the rest of the capital usually coming from local governments. If Hanergy fulfills its expansion plans, it will have a solar panel production capacity of around 6.6 GW, while globally added capacity was just less than 40 GW last year, with a quarter of it coming from China. It believes that its markets success is dependent on it`s development and delivery to customers of its latest CIGS panels and considering Hanergy does not currently figure among the top sellers globally, all will indeed depend upon the volume of its CIGS panels shipped to end users.

 

 

Hanergy launches full-solar-power vehicles with daily range of 80km (2016 Update)

 

 

Hanergy Board chairman & CEO Li Hejun launched 4 new fully solar powered vehicles. The new series of vehicles includes the Solar O, Solar L and Solar A and sports car 'Hanergy Solar R” each targeted at different groups of users.

 

 

With a solar energy conversion rate of 31.6%, Hanergy's gallium arsenide (GaAs) dual-junction solar cell was awarded with a World Record Certificate by the World Record Association at the launch event. Previously, on 5 January, the technology had been recognized by the US National Renewable Energy Laboratory (NREL) for its record efficiency.

 

 

The four new full-solar-power vehicles are integrated with flexible, highly efficient GaAs solar cells, maximizing the area covered (3.5-7.5m2). Through a series of precise control and managing systems (including a photoelectric conversion system, an energy storage system and an intelligent control system), the zero-emission vehicles use solar energy as the main driving force. With 5-6 hours of sunlight, the thin-film solar cells can generate 8-10kW-hr of power per day, allowing the vehicle to travel about 80km (equivalent to over 20,000km annually), and hence satisfying the requirements for city driving under normal circumstances.

 

 

Users can manage different travelling and weather modes in a real-time, mobile, networked and smart way, selecting charging modes in accordance with varied weather conditions through Apps on their mobiles. In everyday-use mode, the vehicles can charge themselves with solar energy while traveling, making 'zero charging' possible for medium- and short-distance journeys. So, unlike traditional electric vehicles, the full-solar-power vehicles hence no longer need to rely on charging posts, eliminating the concept of 'distance per charge'. For weak sunlight or long-distance travel, the lithium batteries in the vehicle can get power from charging posts, enabling them to travel a maximum of 350km per charge.  

 

 

Hanergy claims that the four new vehicles are the first full thin-film solar power vehicles that can be commercialized, breaking the bottleneck of poor practicality of previous solar-powered vehicles. The firm has also signed a framework agreement with Foton Motor to cooperate on developing clean energy buses.

 

China State Construction Engineering...

China State Construction Engineering Corporation

China State Construction Engineering Corporation Limited (CSCEC) is China’s largest construction and real estate conglomerate. It is a public company listed on the  Shanghai Stock Exchange and ranked 37th among Fortune Global 500 companies in 2015.

 

 

Specializing in building construction projects, real estate development and investment, infrastructure construction and investment, as well as design and surveying operations. The Company’s main business activities comprise construction of residential projects, undertaking of municipal public works, road works and building construction works; undertaking of airports, housing, roads, bridges, water supply, medical facilities, hotels and tourism, government projects and sports facilities and other projects; real estate development activities; construction of highway, railway, municipal, energy, petrochemical, water, environmental protection and telecommunication projects and other infrastructure works, as well as architectural design, urban planning, engineering investigation, municipal public work design business, among others. Established in both domestic and international markets, China Construction operates in more than 20 countries and regions around the world.

 

 

National Growth.

The Company continued to enhance its infrastructure investment, construction and operation standards through high-end integration, investment/financing and business model innovations, revolving around the three major national strategies: the “Belt and Road”, “Jing-Jin-Ji Integrated Development” and “Yantze River Economic Belt”. During 2015, the value of newly executed infrastructure contracts exceeded RMB300 billion for the first time and hit RMB 314.0 billion, up 26.7% YoY. The Company has devoted itself to creating a fully integrated investment platform for “new urbanization” construction initiatives focusing on ten selected tier-1 and 2 cities.

 

 

In international contracting, China Construction is the countries largest international contractor and also the first to launch international contracting in China. With the encouragement of the Chinese government and financing assistance from the Export-Import Bank of China, CSCEC has taken increasingly bold steps as a builder and investor of overseas projects. By the end of 2015, its total contract value for overseas business was US$80.7 billion and total turnover of US$52.4 billion. China Construction has so far completed over 5,600 projects in some 116 countries and regions around the world.

 

 

Major Earnings in 2015 were: total revenue of RMB 880.6 billion, up 10.1% YoY. Specifically, revenue from the housing construction business was RMB 588.3 billion, up 6.0% YoY; revenue of the infrastructure business was RMB 141.4 billion, up 19% YoY; and that of the real estate business was RMB 142.4 billion, up 15% YoY.

 

 

Recent International contracts in include:

  • US$ 2.89 billion Pakistani Karachi-Lahore Motorway
  • Egyptian New Capital (~US$ 2.7 billion)
  • St James Suites in New Zealand, with the contract value of NZD130 million.
  • Renovation Works of 67 Municipal Roads in Libreville of Gabon.
  • Nairobi BULK Water Supply Pipeline, with the contract value of approximately USD 70 million.
  • CSCEC Middle East has been award the management facility project in Kuwait Sabah Salim University City.
  • Eastern Technological University of Panama Project with the contract value of US$176 million.
  • Oran Shopping Mall Project in Algeria with the value of US$99 million.
  • Concrete Supply Contract for a Package of Projects of China-Kazakhstan Khorgos Border Cooperation Center.
  • Crude Oil Refinery Plant in Lagos, Nigeria, with daily processing capacity of 400,000 barrels.
  • Indonesia Jakartar, Twin Tower Project.
  • Municipal road construction project of Nkayi City of Bouneza, Republic of Congo.
  • Commercial apartment development: 99 Hudson Street, New Jersey.
  • 62km Road Project in Zambia, with the contract value of ZMW177 million.
  • Dubai high-rise hotel project with the contract value equaling to US$94.82 million.
  • 190km road project in the West Province of Zambia, with a contract value of USD 200 million.
  • National Stadium Project in Ethiopia. The total contract price is USD$ 120 million.

 

 

COFCO (China National Cereals, Oils...

COFCO (China National Cereals, Oils and Foodstuffs Corp).

Overview.

 

 

COFCO Corporation is a leading supplier of agri-products, diversified foodstuffs and services in China, integrating agri-trading, logistics, processing, production and sale links, and providing grain and oil products to one quarter of global population. At present, COFCO owns over 180 processing factories domestically with 2.3 million terminal points of sale covering 952 large and medium-size cities, and more than 100 thousands counties, towns and villages.

 

 

COFCO boasts a wide range of branded products and service portfolios, including Fortune edible oil, Great Wall wine, Le Conte chocolate, Tunhe tomato products, Joycome meat products, Xiangxue flour, The Cereal Way instant noodle, Lohas fruit juice, Joy City shopping mall, Yalong Bay resorts, China Tea products and COFCO-Aviva Life Insurance, etc

 

 

A Global Challenge.

 

 

COFCO has more than 10,000 employees in more than 70 nations and regions working in various overseas markets, mainly in Asia, Latin America and Europe. It plans to further improve its capability in maritime transportation and food processing, as well as the entire supply chain services in seed, pesticide and fertilizer businesses over the next five years.

 

 

Facing increased food security issues from factors such as extreme weather and dwindling farmland resources, COFCO is increasing becoming a global giant. The company is building grain and other agricultural product supply chains, particularly with countries in the Black Sea regions and South America, the world's two biggest grain-producing areas.

 

 

Last year, COFCO invested $1.5 billion for a 51 percent stake in the agribusiness operations of Hong Kong-based Noble Group, and reached an agreement with the Netherlands-based agricultural and commodity trading group Nidera BV to acquire 51 percent of its stock, which will see a fully integrated value chain created between the firms.

 

 

The acquisitions mean COFCO now holds more than $70 billion of assets and has a storage capacity of 15 million metric tons in more than 60 nations. Its total food processing capacity has reached 84 million metric tons and it is capable of shipping 44 million tons of agricultural products via various ports around the world.

 

 

Subsidiaries

 

 

COFCO Agri-Trading & Logistics

COFCO Tunhe

JOY CITY PPT

COFCO Engineering Technology

Mengniu Dairy

China Agri-Industries

COFCO Meat

China Tuhsu

Womai.com

Nidera

China Foods

CPMC

Financial Services Dept.

Huafu Group

Noble Agri

 

 

Outlook.

 

 

COFCO has committed to deploying resources and manpower along the Belt and Road Initiative routes over the next five years to help guarantee China's food supply at home and to its key markets overseas. Though the initiative is still in its early stages of development, it has strong implications for many nations along the routes that count on agriculture and international agribusiness cooperation. Many countries along the routes are key global grain producers, and COFCO will continue to seek investment and cooperation opportunities with them over the next five years.

Sina Corporation.

Sina Corporation.

Sina Corporation is an online media company targeting the global Chinese community. Founded in 1998 and headquartered in Shanghai, it is publicly traded in the US on NASDAQ where it IPO`d in 2000. It operates some of the most popular web portals and social media sites in China which feature targeted content. Users browse most content for free, and the company monetizes its readership by selling advertisements similar to traditional media formats. Historically, the company’s web portals have been the most important channel for reaching users, but its social media platform, Weibo, continues to gain in significance for the company following its launch in late 2009.

 

 

The company sells advertisements, which constitutes about 80% of its revenue, on its web portals (please click here to see it’s various portals) and social media properties. Sina operates multiple portal sites for audiences in different places (mainland China, Taiwan, Hong Kong, etc), featuring a wide range of content. The mix of content enables the company to offer advertising clients placement in specific areas of interest (sports or finance, luxury etc) to reach their target audience. The majority of Sina’s advertising business is brand advertising, which focuses on building a brand opposed to influencing an immediate purchasing decision.

 

Pricing for advertising can vary based on the portal property, as well as which channel (sports, auto, finance, news, entertainment, etc.) the advertiser chooses. Examples of pricing are shown below (taken from the 2014 advertising rate card

·         Homepage banner (top of page, 1000x90 pixels, all 5 slots): 450,000 RMB per    day (or 100 RMB per CPM/day)

·         Homepage banner (top of page, 1000x90 pixels, first slot in rotation): 430,000   RMB per day

·         Homepage button (near top of page, 240x350 pixels): 450,000 RMB per day

·         Fashion page button (marriage section, 300x200 pixels): 15,000 RMB per day

·         Homepage text links (near autos section): 180,000 RMB per day

·         Sina news page text link (near society news, right side): 12,000 RMB per day

Major revenue streams are from customers in the automotive, fast-moving consumer goods, Internet services, financial services, IT and telecommunication industries. The company suggested that its target customers are multinationals and large domestic companies looking to build their brand within China.

 

The company’s non-advertising business includes Mobile Value Added Services, Weibo Value Added Services, online games, and other fee-based services the company provides.

 

Current company information and investor news is available via its English homepage found here

China Railway Engineering Corporation...

China Railway Engineering Corporation.

China Railway Engineering Corporation (CREC) 中国中铁 is the second largest construction contractor in the world and occupies the 102th place on the Fortune Global 500 list. The Beijing-based SOE, together with its main rival, China Railway Construction Corporation, are of vital importance to the infrastructure expansion plans of China. The Group has 46 subsidiaries, including 28 wholly owned subsidiaries, 15 holding subsidiaries, 4 branch companies and 3 joint venture subsidiaries. CREC's construction teams are found in over 1,000 cities throughout China. In addition to the core business of construction, the company does surveying & design, installation, manufacturing, R&D, technical consulting, capital management as well as international economic and trade activities.

 

  

 

CREC has shown strong financial performance in recent years, as is shown in its financial results below (for its full annual report please click here). The company signed new contracts worth ¥929.6 ($149.2) billion dollars last year (2013), while existing contract revenue was ¥1.38 trillion ($222.3 billion).

 

 

2013

2012

Change %

Revenue

¥540.4($86.7) billion

¥465.6 ($74.7) billion

16.1%

Gross profit

¥40.3 ($6.5) billion

¥35.6 ($5.7) billion

13.4%

Net Profit

¥9.4 ($1.5) billion

¥7.4 ($1.2) billion

26.8%

 

 

Three sources constitute the majority of CREC’s revenue: railways, highways and municipal  construction. Last year the company built 4,843 kilometres of railways, 1,008 kilometres of new highways and 199 kilometres of light railway and subway lines. Notable projects include:

 

 

 

Railway lines

Highways

Municipal works

Nanjing - Hangzhou

Dali – Lijiang

Beijing Subway

Hangzhou - Ningbo

Fengjie – Wuxi

Shenzhen Subway

Tianjin - Qinhuangdao

Kunming – Bangkok

Shanghai Metro

Xiamen - Shenzhen

118 kilometres in Ethiopia

Guangzhou Subway

Addis-Ababa railway

Jiujiang Yangtze River

Shenyang 4th Ring Road

Tbilisi railway

Bristol Grieg cable bridge (Morocco)

Liuzhou Guangya Bridge

 

 

Other business areas in which CERC operates are: engineering equipment manufacturing, surveying, design, consulting, property development and natural resources mining, with the latter two showing the fastest growth.

 

 

Increasingly important, but often overlooked, is the China Railway Resources Group (CRRG), responsible for precious metals, ferrous and non-ferrous metals extraction, as well as logistics and surveying. With a strong focus on mineral extraction, specifically gold, copper, coal, cobalt, silver, nickel, zinc, lead and graphite, the Group has an active presence in Qinghai, Xinjiang, Inner Mongolia and Heilongjiang (where CRRC and Baoan Steel have signed an agreement to cooperate over a graphite mine). International operations in Congo, Australia, Laos and Venezuela (CREC began construction in 2009 of the Anaco-Tinaco railroad, an 800 million USD project to build a 471 km high speed railway line across the country).

China National Salt Industry Corporation...

China National Salt Industry Corporation.

China Salt is a state owned company that has a monopoly over the management and production of edible salt in China. It is one example of an SOE that the public is beginning to question the need for- is salt a matter of national security in 2014?

 

 

Employees: 60,000

Subsidiaries: 46 over 22 provinces

Total assets: 34.5 billion in value

Output: 12 million tons salt annually,

7.7 million tons salt chemical products annually

 

 

China has a long history of many dynasties using salt as a major source of government revenue, with it still representing over 5% of the total national tax by the founding of the PRC. Nowadays, salt brings in only a very small percentage of national tax, but the monopoly still costs consumers an average of an extra 10 yuan per year in excessive profits.

 

 

One reason for the state affiliation decades ago was for health reasons as iodine deficiency is a common problem among under-nourished populations. As salt can be iodized or non-iodized, the government wanted to ensure that all citizens were consuming salt with iodine to resolve this problem. However, this is no longer the case for the Chinese population and in fact China is joining the developed world now in having the opposite problem, with people consuming too much iodine, also leading to health complications. Now, Chinese consumers have no option to purchase salt with iodine as there is no private market.

 

 

CNSIC has a monopoly in China on table salt, with sub-enterprises encompassing production, packaging, and distribution. The company was founded in 1950 and falls under the administration of the State Council. Regulations in China prohibit salt from being sold across regional lines or from private citizens selling their own manufactured salt. This particular law led to the removal of all salt listings from Taobao’s marketplace in March 2013.

 

 

One negative outcome of the monopoly is in the food industry, in which there have been reports of food product manufacturers, such as soy sauce and other seasonings, illegally using industrial salt rather than table salt in their products to cut down on costs.

 

 

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