Venture Veteran Doll Says Companies Will Turn to China for IPOs

Jan. 19 (Bloomberg) -- Veteran venture capitalist Dixon Doll predicts that more U.S. technology companies will start holding initial public offerings in other countries as economic growth in Asia outpaces domestic expansion.

“In the next 10 years, I expect more portfolio companies to list on foreign exchanges,” said Doll, founder of Menlo Park, California-based firm DCM, in an interview last week. China “will become a big deal.”

The U.S. venture-capital industry is coming off its slowest two-year stretch for IPOs since the mid-1970s, with only 19 in 2008 and 2009, according to the National Venture Capital Association. Doll said that while U.S. companies may not flock to China in the next year or two, the world’s third-largest economy will be increasingly attractive for technology startups as its capital markets mature.

China’s gross domestic product will expand 8.5 percent this year and 9.3 percent next year, according to Bloomberg surveys of economists. That compares with average predictions for U.S. growth of 2.7 percent in 2010 and 3 percent in 2011, according to Bloomberg.

Doll, 67, said he expects 40 to 50 venture-backed companies in the U.S. to go public this year, because the “system is so constipated” from two years of inactivity. The financial crisis wiped out investment banks such as Lehman Brothers Holdings Inc. and Bear Stearns Cos., and forced more than 850 hedge funds to shutter in the first nine months of 2009. That left fewer banks to lead IPOs and fewer investors to buy shares in them.

DCM, which also has offices in Beijing and Tokyo, was an investor in About.com, acquired by New York Times Co., and Clearwire Corp., the mobile-Web network company that went public in 2007. Current investments include BitTorrent, whose software allows users to download and share files over the Internet, and RockYou, which helps advertisers promote their brands on social networks.

Of his firm’s IPOs, Doll said one or two will happen in China in the next two years.

Source: Chinadaily

Posted at 02:43PM Jan 20, 2010 by admin in China Business  |  Comments[0]

Disney locked into grave issue

SHANGHAI Disneyland is going to be built on some hallowed ground in Pudong New Area.

About 1,200 tombs will be moved in order for the Mickey Mouse theme park to be built, funeral authorities said yesterday.

Separately, officials said they would promote a new tomb that uses less land.

Chinese families will move the graves of their ancestors if they believe the new location is better. People believe that a good burial place will bless future generations.

Thus, negotiations proved to be delicate with the families of four villages in Pudong's Chuansha Town.

The local government and the villagers eventually agreed that a subsidy of 300 yuan (US$43) an urn will be provided so they can find a new resting place for their ancestors.

Huilong Cemetery in Pudong will set aside 1,000 square meters to bury urns and another 1,000 square meters to establish mini-tombs. A mini-tomb will cost 3,600 yuan.

"For families who choose to bury urns without a grave in our cemetery, the 300 yuan subsidy will be given to us directly," said Ding Guojun, general manager of the cemetery. "More than 400 tombs have been moved so far."

Ding said most tombs will be moved between December 25 and 27 to avoid a tomb sweeping peak on December 22, winter solstice. The remainder will be moved before next year's Qingming Festival.

Also yesterday, the Shanghai Funeral and Interment Association said it will soon start promoting "duplicate tombs."

The land-saving tombs will occupy only 1 square meter and will hold up to eight urns, officials said.

The project is being tested at two cemeteries. The tombs are expected to be used in cemeteries across the city around the Qingming Festival.

The association said every year the city will allocate 165,000 square meters of land for tombs.

Source: Shanghai Daily
Related links:
Govt buys ticket for Disney Shanghai
Expo Shanghai 2010 Tickets News: 3-day, 7-day ticket sales start in January

Posted at 03:30PM Dec 17, 2009 by admin in China Business  |  Comments[0]

Foreign investment in China increases

FOREIGN direct investment in China climbed in November at the fastest pace in 16 months, extending a streak of gains for the fourth straight month thanks to encouraging economic performance in the world's third largest economy.

But analysts warned that these signs of growth might attract speculation in China's currency, or hot money.

China's FDI expanded 32 percent last month from a year earlier, to US$7 billion. The number of newly established foreign-invested firms rose 10 percent to 2,437, the Ministry of Commerce said yesterday.

The November gain in FDI far outstripped October's advance of 5.7 percent, but the dollar volume was very similar to the October figure of US$7.1 billion.

Despite the recent gains, investment in the first 11 months still declined almost 10 percent on an annual basis to US$77.8 billion.

'Stable' recovery

"China's FDI has been in a stable process of recovery since August," said ministry spokesman Yao Jian. "Coastal provinces including Jiangsu, Guangdong and Liaoning are staging faster growth."

Shanghai attracted US$850 million in foreign direct investment last month, up 6.3 percent from a year earlier.

Surging investment from economies under the Association of Southeast Asian Nations, which soared 60 percent last month, was the driving factor in the FDI growth, Yao said. It helped to counter declining investment from the United States and Europe, which dropped 38 percent in November.

The ministry predicted China's FDI will expand steadily and may stay within the US$7 billion to US$8 billion range in the next few months.

Li Maoyu, an analyst at the Changjiang Securities Co, said China's improving economic performance has strengthened confidence among foreign investors.

But he warned of the possibility of more speculative money flowing into the country.

Hot money

"The sharp growth in November is partly due to a low base last year, while China's stable economic performance raised stakes for the country to be one of the most attractive destinations for investment," Li said.

"However, the government should notice China's robust economy also draws in speculators, who bet Chinese currency will appreciate."

Worries about hot money have returned after China's economic prospects continued to improve, triggering anticipation for a rising yuan.

Last month, China announced a new rule that limits overseas individuals or institutions to sending foreign currencies to no more than five Chinese individuals to convert them into yuan the same day, a move aiming to curb speculative cash.

Sorece: Shanghai Daily

Related links:
Foreign firms may sell bonds
China to allow foreign-invested companies to list
Probe 'not revenge' for hefty tire tariff

Posted at 03:21PM Dec 17, 2009 by admin in China Business  |  Comments[0]

Foreign firms may sell bonds

Foreign companies may be able to sell bonds in China within a year as the government expands its domestic capital markets, according to China International Capital Corp (CICC), the No 2 underwriter of yuan debt this year.

"The first group of future international issuers is likely to be blue-chip companies," John Cheng, CICC's investment banking managing director, said in an interview on Tuesday.

Overseas "firms will increase their presence in China and they'll need to match their growing yuan assets with instruments in yuan, be it debt or equity," he said.

China is urging domestic companies to tap bond and equity markets for funding and reduce reliance on banks after regulators said record loan growth poses risks. Authorities will consider allowing sales of high-yield corporate bonds to provide new sources of funding, People's Bank of China Deputy Governor Hu Xiaolian said on Nov 18.

Outstanding corporate debt rose almost threefold to 2.1 trillion yuan at the end of October compared with 2006, Hu said at a forum in Beijing.

The government has encouraged a $1.3 trillion credit boom this year to complement its monetary and fiscal stimulus plans, propelling the economy last quarter to its fastest pace of expansion in a year.

The government may need to rein in loan growth to "prevent the emergence of inflationary pressures and asset bubbles", the Organization for Economic Cooperation and Development said on Nov 20.

The five biggest banks - Industrial & Commercial Bank of China Ltd, China Construction Bank Corp, Bank of China Ltd, Agricultural Bank of China and Bank of Communications Ltd - extended a record 4.7 trillion yuan of loans in the first nine months. They submitted money raising plans to regulators after that record lending eroded their capital, people familiar with the matter said.

Domestic debt sales almost doubled to 1.8 trillion yuan this year, according to data compiled by Bloomberg. Beijing-based CICC underwrote 174 billion yuan of transactions, ranking second after ICBC, the world's biggest bank by market value.

Minor modifications to regulations would be required for foreign companies to be able to tap the market, Cheng said. Some "companies have expressed interest but no formal applications have been made", he said, declining to name any companies.
Coca-Cola Co, the world's largest soft-drink maker, said on Nov 23 it plans to more than double bottling plants in China over the next decade, aiming to triple sales.

Inter IKEA Center Group, a developer of shopping malls that have an IKEA store as an anchor tenant, plans to invest as much as $1.2 billion in the world's fastest-growing economy over the next five years, it said on Tuesday.

Coca-Cola Hong Kong-based spokesman Geoff Walsh wasn't available for immediate comment. Kastrup, Denmark-based Inter IKEA Center didn't respond to e-mails to its Shanghai office.

The Manila-based Asian Development Bank and the World Bank's International Finance Corp unit are among supra-nationals that have sold so-called panda bonds, or yuan-denominated notes issued by foreign entities in China, Bloomberg data show.

Domestic sales by overseas companies would probably differ from the panda market in that they wouldn't be coordinated by the Ministry of Finance, Cheng said.

HSBC Holdings Plc's China unit joined a group managing a bond sale for Bank of Shanghai Co, becoming the first foreign lender to participate in the underwriting of a yuan-denominated financial bond in China, it said on Nov 17. A unit of the London-based bank sold yuan bonds in Hong Kong in June.

As China's corporate bond market develops, so will its fledgling derivatives market, according to Cheng.

"When you buy bonds in China now you cannot lay off different risk components," he said.

"In order to do this, domestic derivatives instruments are needed. For a full market to develop, you need these auxiliary tools."


Source: China Daily

Related links:
China to allow foreign-invested companies to list
Probe 'not revenge' for hefty tire tariff

Posted at 11:18AM Nov 26, 2009 by admin in China Business  |  Comments[0]

Probe 'not revenge' for hefty tire tariff

Just two days after the decision by the United States to levy heavy import tariffs on Chinese tires, the Chinese government  has reacted by launching an anti-dumping and anti-subsidies investigation into automotive and chicken exports from the US.

The Ministry of Commerce (MOFCOM) Sunday did not label it as retaliation against the tire dispute, but said it acted simply in a response to domestic concerns.

The probe, which is in line with World Trade Organization (WTO) rules, follows complaints from Chinese manufacturers that US-made products entered the nation's markets with "unfair competition" and harmed domestic industries, said the ministry in a statement.
[Read More]

Posted at 12:02PM Sep 14, 2009 by admin in China Business  |  Comments[0]

China to allow foreign-invested companies to list

China will gradually reduce limits on equity stake proportion in investment from overseas companies, allowing qualified foreign-invested enterprises to list in the country's stock market, Chen Deming, Minister of Commerce, said Tuesday.

The move aims at expanding cooperation fields between China and foreign countries, innovating investment avenues and optimizing foreign investment structures, Chen said at the 13th China International Fair for Investment and Trade (CIFIT) in Xiamen, southeastern Fujian Province without saying when it will take effect.

Posted at 01:07PM Sep 09, 2009 by admin in China Business  |  Comments[1]

China is doing well amid financial crisis: Cohen

BEIJING, March 22 (Xinhuanet) -- China will do well in fighting global financial crisis, former U.S. Defense Secretary and Chairman of Cohen Group William S. Cohen said.

   "China has the opportunity to continue to  recover fast and set standards for other nations to follow," Cohen told Xinhuanet, the online news portal of the Xinhua News Agency at the sidelines of the ongoing China Development Forum 2009 in Beijing Sunday.

Posted at 07:28PM Mar 23, 2009 by admin in China Business  |  Comments[0]

The Canton Fair: is it worth visiting?

If you are in search for new products and suppliers, the canton fair is probably one of the best places to go. Some advantages of visiting the fair vs. doing online research:

• meet the suppliers in person
• check the products quality - it's always better to inspect the product yourself before you place an order.
• negotiate the price in person - for some companies it's a big investment to be on the canton fair and are there to make deals. Some of them rely on the canton fair for their entire annual production. You can drop the price a lot, it's all up to your negotiation skills.
• find reliable companies - the cost for suppliers to attend on the canton fair is usually over $10000. It's more unlikely a reseller or fraudster to register and attend there, compared to free online presence.

Posted at 10:42AM Feb 23, 2009 by admin in China Business  |  Comments[1]

Canton Fair FAQ (II)

5. Where is the venue?

China Import and Export Fair Complex (Pazhou complex) is the main venue.

Adress: No.117, Liuhua Rd

How to get there: take subway 2 get off at Xingangdong station and exit at exit A.

Posted at 02:05PM Feb 19, 2009 by admin in China Business  |  Comments[0]

Canton Fair FAQ (i)

1. What is Canton Fair?

Posted at 02:17PM Feb 18, 2009 by admin in China Business  |  Comments[0]

Yiwu: Secret to Amassing Vast Wealth or Junkyard? (ii)

I found the beads, but the next step depended on how “factory direct” each sales booth really was. Some people offered me to take me to their Yiwu factory later that afternoon, while others were vague as to their factory’s location (if there even was one) and other important details. If the booth was not actually a representative sales office of a factory, almost all the other booth owners said they were the “sister” or “brother” of a factory making this product— always a worrisome sign in the sourcing business. Some booths welcomed me to take samples, while other said I had to pay, and other said I could not take any samples and could only take pictures.[Read More]

Posted at 09:53AM Nov 07, 2008 by admin in China Business  |  Comments[2]

Yiwu: Secret to Amassing Vast Wealth or Junkyard? (i)

The answer to the question to the title is: both. I got to take my second trip to Yiwu last month. The goal was to find some prices and samples for Mardi Gras beads—that’s right, those beads they throw on flashing girls on the spring break videos. I guess the beads have other purposes too but I am from the northern US and not too familiar with this product.[Read More]

Posted at 11:38AM Nov 05, 2008 by admin in China Business  |  Comments[2]

Hangzhou comes out among the top 10 most competitive cities

Hangzhou, the home city of Yoyoor, comes out among the top 10 most competitive cities, as released in the annual city competitiveness ranking in China, 2008. The rank was established according to performance and structural criteria including economic growth and dynamism, resources potential, business and infrastructural development, along with cultural image and activities, of more than 200 cities in China, including Hong Kong, Macao and Taipei. Hangzhou ranked top in indicators such as Economic Scale competitiveness and economic structure competitiveness.[Read More]

Posted at 10:08AM Sep 10, 2008 by admin in China Business  |  Comments[2]