Tag Archives: HK

China’s Evergrande to sell stakes in HengTen internet unit for $418 mln

A logo of China Evergrande Group is displayed at a news conference on the property developer’s annual results in Hong Kong, China March 28, 2017. REUTERS/Bobby Yip/File Photo

HONG KONG, Aug 2 (Reuters) – China’s most indebted property developer Evergrande Group (3333.HK) has agreed to sell stakes in its internet unit HengTen Networks Group Ltd (0136.HK) worth a total of HK$3.25 billion ($418.2 million), an exchange filing showed on Sunday.

Shares of Evergrande declined more than 2% in early trading on Monday on continued worries over its financial health, while HengTen jumped more than 30%. Shares of HengTen resumed trading on Monday after a suspension on Thursday.

Worries over the developer’s debt and the potential for systemic financial risk have intensified after Evergrande said in June its project companies had not paid some commercial paper on time, but it said it was arranging payment.

Fitch downgraded its credit rating on Wednesday, signalling its concern of a potential default. read more

To ease the pressure, Evergrande will sell a 7% stake at HK$3.20 per share to a unit of Tencent Holdings Ltd. for HK$2.07 billion and a 4% stake to an unidentified buyer for HK$1.18 billion. The filing did not give a timing for the sale.

Before the transaction, Evergrande held a 37.55% stake in the company, while Tencent (0700.HK)held 16.9%. Evergrande’s stake will go down to 26.55% and Tencent’s holdings will increase to 23.9% after the sale, the filing showed.
Evergrande has agreed to provide a 5-year loan of HK$2.07 billion to HengTen to support its business development, the company added in the filing.

HengTen’s shares are expected to resume trading on Aug. 2 after being halted on July 29, the filing showed.

($1 = 7.7720 Hong Kong dollars)

($1 = 7.7721 Hong Kong dollars)

Reporting by Marius Zaharia; Additional reporting by Clare Jim; editing by Barbara Lewis and Sonali Paul

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Ant-backed Zomato’s roaring India debut sets pace for internet startups

BENGALURU, July 23 (Reuters) – Shares of food delivery firm Zomato Ltd (ZOMT.NS)nearly doubled on Friday in a stellar first listing of a local unicorn in India, setting the pace for a slew of such debuts by internet-based startups that are thriving during the COVID-19 pandemic.

Berkshire Hathaway Inc-backed (BRKa.N) Paytm, hospitality company Oyo Hotels and ride-hailing firm Ola, both backed by SoftBank (9984.T), are among the Indian startups set to enter markets, riding on support from foreign funds and local investors.

Shares of Zomato soared 82.8% after opening at 116 rupees in pre-open trade, a 53% premium to the offer price of 76 rupees for the 93.75 billion rupees IPO, valuing the company at about $12 billion.

China’s Ant Group holds a 16.53% stake in Zomato, while its top shareholder is online technology company Info Edge (India), which holds a 18.55% stake.

“Today is a big day for us…we couldn’t have gotten here without the incredible efforts of India’s entire internet ecosystem,” Zomato’s founder and Chief Executive Deepinder Goyal said in a blog post.

Goyal, 38, an alumnus of the Indian Institute of Technology in Delhi, launched Zomato in 2008 with fellow graduate Pankaj Chaddah. As of March 31, it operated in about 525 cities in India and has partnered with close to 390,000 restaurants.

It is the first startup to go public in India’s food delivery market, which research firm RedSeer estimated is worth $4.2 billion. It offers home delivery of food, allows customers to book tables for dining-in and collates restaurant reviews, making it a competitor to SoftBank-backed Swiggy and Amazon.com’s (AMZN.O) food delivery service.

The company’s offering last week drew bids worth $46.3 billion, making it more than 38 times oversubscribed, with big institutional investors placing major bets. read more

“Growth is key here. Zomato might not be profitable but it is growing exponentially and is enviably positioned to keep that momentum,” said Danni Hewson, a financial analyst with AJ Bell, an investment platform in England.

Zomato’s loss for the year ended March 31 narrowed to 8.13 billion rupees, while revenue from operations fell slightly year-on-year to 19.94 billion rupees.

“We are…not going to alter our course for short term profits at the cost of long term success of the company,” Goyal said.

($1 = 74.5250 Indian rupees)

Reporting by Chandini Monnappa and Anuron Kumar Mitra in Bengaluru; Editing by Arun Koyyur and Kim Coghill

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Tencent snaps up British video game developer Sumo in $1.3 bln deal

  • Shares surge in early trading to all-time high
  • Tencent offers 513p per Sumo share
  • Sumo boss says he is keen work with Tencent

July 19 (Reuters) – China’s Tencent (0700.HK) will buy British videogame developer Sumo (SUMO.L) in a $1.27 billion deal, it said on Monday, adding new titles to its growing portfolio of chart-topping videogames.

The purchase, which will boost the Chinese internet giant’s presence globally, brings together Sumo’s racing and snooker games with Tencent’s more high-profile range of games that includes Call of Duty’s mobile version.

Shareholders in Sheffield-based Sumo will get 513 pence in cash per share, a 43% premium to the last price and valuing the company at 919 million pounds, Tencent said, sending Sumo’s shares surging 42% to a record high.

The deal comes days after China’s market regulator decided to block Tencent’s plans to merge videogame streaming sites, Huya (HUYA.N) and DouYu, on antitrust grounds.

It is the second major deal involving a British video game company over the past year, following U.S. video game maker Electronic Arts’ (EA.O) deal to buy Britain-based Codemasters. read more

Tencent, with stakes in companies that make Fortnite and League of Legends, is the world’s second-largest videogame group by revenue after Sony.

“Chinese deals may imply a higher regulatory risk, but we see no likely resistance or counterbid,” Jefferies analysts said.

EXPERTISE AND RESOURCES

Sumo, which counts Microsoft’s Xbox, Amazon Game Studios, Apple, Google and BBC as its clients and partners, has seen its value soar since a 2017 listing on LSE’s junior market AIM at 100 pence.

“The Board of Sumo firmly believes the business will benefit from Tencent’s broad videogaming eco-system, proven industry expertise and its strategic resources,” non-executive chairman Ian Livingstone said.

Tencent owns 8.75% and is the second-biggest shareholder in Sumo, which has 14 studios in five countries and released the video games including Hotshot Racing, Sackboy: A Big Adventure and WST Snooker last year.

Sumo’s boss Carl Cavers said he and co-founders Paul Porter and Darren Mills would reprise their roles.

“The opportunity to work with Tencent is one we just couldn’t miss,” said Cavers, who founded the company 18 years ago.

($1 = 0.7261 pounds)

Reporting by Muvija M in Bengaluru; Editing by Arun Koyyur and Edmund Blair

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Canada judge won’t allow Huawei CFO to use HSBC documents in U.S. extradition case

VANCOUVER, July 9 (Reuters) – A Canadian judge has denied Huawei Chief Financial Officer Meng Wanzhou’s application to add a trove of documents her legal team received from HSBC as evidence to her U.S. extradition case, the judge announced on Friday.

Meng, 49, is facing extradition from Canada to the United States on charges of bank fraud for allegedly misleading HSBC about Huawei’s business dealings in Iran, potentially causing the bank to break U.S. sanctions. She has been held under house arrest in Vancouver since December 2018, when she was first detained.

Her legal team received over 300 pages of internal documents from HSBC through a court on Hong Kong, which the defence argued should be entered as evidence because they would disprove the basis for the United States’ extradition claim. read more

Associate Chief Justice Heather Holmes, who has been overseeing the case in the British Columbia Supreme Court since its inception, disagreed. Her reasons will be released in writing in approximately ten days, Holmes said.

“We respect the court’s ruling, but regret this outcome,” Huawei Canada said in a statement released after the ruling, insisting that the documents showed HSBC was aware of Huawei’s business dealings in Iran, proving that the United States’ account of the case was “manifestly unreliable.”

The Canadian government did not immediately respond to a request for comment.

Meng is set to appear in court in early August. Her extradition hearings are scheduled to finish by the end of that month.

Reporting by Moira Warburton in Vancouver; editing by Diane Craft

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Canada’s Hong Kong diaspora helps new arrivals with jobs, housing, psychotherapy

OTTAWA, July 4 (Reuters) – Hong Kongers in Canada are banding together to help the latest wave of immigrants fleeing Beijing’s tightening grip on their city.

Networks across the country, some descended from groups set up after China’s crackdown on Tiananmen Square protesters in 1989, are offering new arrivals everything from jobs and accommodation to legal and mental health services and even car rides to the grocery store.

“We are in a battle. These are my comrades, people who share the same values,” one 38-year-old who asked to be identified only as Ho told Reuters. “Who is going to provide that helping hand if I’m not going to?”

Ho runs a cooking school near Toronto, and said he hired a former aide to a Hong Kong democratic politician to promote his business online, and recently took on a new kitchen assistant who took part in the city’s 2019 pro-democracy protests.

Ho, who came to Canada as a teenager before Britain handed Hong Kong back to China in 1997, is just one person helping the network of support groups that have been formed in Toronto, Vancouver, Calgary and Edmonton in the past two years.

Immigrants looking after each other is not unique. But people in Canada, which has one of the world’s biggest overseas concentrations of people from Hong Kong, told Reuters the situation is urgent because many of the people they are seeking to help fear they will be arrested for taking part in past protests and may not be able to afford professional help to resettle overseas.

“It’s my natural duty,” said Ho, who asked not to be identified by his full name, and did not name his new employees, for fear of problems with Hong Kong authorities. “If I was in Hong Kong, I would be in a desperate position. If there was a helping hand, I would hold onto it.”

Beijing imposed a sweeping national security law on Hong Kong a year ago, outlawing a wide range of political activities and effectively putting an end to public protests. Many pro-democracy activists and politicians, including prominent Beijing critics Joshua Wong and Jimmy Lai, have been arrested under the new law or for protest-related offences. Many people have already left the territory.

The Hong Kong government and China say the law was necessary to restore stability after the sometimes violent protests of 2019, and that it preserves freedoms guaranteed by Beijing after Britain handed Hong Kong back to China.

“The Hong Kong national security law upholds the rights and freedoms of Hong Kong people,” said a spokesperson for Hong Kong’s Security Bureau. “Any law enforcement actions taken by Hong Kong law enforcement agencies are based on evidence, strictly according to the law, for the acts of the persons or entities concerned.”

CANADIAN ‘PARENTS’

Britain and Canada are two of the most popular destinations for people leaving Hong Kong after the imposition of the national security law.

Some 34,000 people applied to live in Britain in the first two months after the country introduced a new fast-track to residency for Hong Kongers earlier this year, according to the Migration Observatory at the University of Oxford, citing government data.

About a fifth of that number applied for temporary and permanent residency in Canada in the first four months of this year, according to the government. The total number of Hong Kongers going to Canada is likely larger but hard to track as many already hold Canadian passports from earlier waves of emigration.

Hundreds of thousands of Hong Kongers moved there in the 1980s and 1990s for fear they would lose wealth and property, or much of their freedom, after Communist Party-ruled China took back control of the city.

But the city prospered and retained freedoms unavailable in mainland China, so many Hong Kongers returned home, or kept a foot in each country. The latest wave of emigration looks more likely to be permanent, as China stamps its authority on Hong Kong. read more

Canada loosened its restrictions on admitting Hong Kongers after the imposition of the national security law last year. It set up a new work visa programme aimed chiefly at young Hong Kongers with a degree or diploma from a post-secondary institution in the last five years, along with two pathways to permanent residency for Hong Kongers in Canada who have recently worked or completed post-secondary studies in the country.

The new coronavirus has complicated matters for new arrivals. Under Canada’s latest travel restrictions, even those who have obtained permission to live and work in Canada through the new programme are only allowed to enter the country if they have a job offer.

That is where the support network comes in. The Toronto Hong Kong Parent Group has so far assisted 40 people, half of whom have already received three-year permits, according to Eric Li, co-founder of the group and former president of the Canada-Hong Kong Link, a rights advocacy organisation established in 1997.

Li said the group has encouraged 20 employers to offer jobs to people arriving from Hong Kong, including Ho’s cooking school, restaurants, a construction company, a travel agency, and a family who hired a Cantonese tutor for their children.

The Toronto group also has interpreters, lawyers and psychotherapists on hand to help new arrivals and has 10 rooms it can provide as free, temporary accommodation. The rooms are in the members’ or their friends’ homes.

Volunteers in Calgary said they have helped at least 29 asylum seekers, picking many up from the airport and driving them to doctors’ offices, grocery stores and banks.

STEPPING STONE

Canada has long had one of the largest populations of overseas Hong Kongers, some of whom came together in 2019 to hold rallies in solidarity with the protests back home.

Many of the new groups can trace their roots to activist organisations that formed in response to Beijing’s crackdown on pro-democracy protesters in and around Tiananmen Square in 1989, or the 1997 handover. The groups already have contacts with social agencies, such as Community Family Services of Ontario or the York Support Services Network, or with churches and professionals willing to help.

The Vancouver Parent Group, supported by the Vancouver Society in Support of Democratic Movement that formed in 1989, has raised more than C$80,000 ($65,963) to help Hong Kong protesters settling in Canada with living costs and legal fees.

Vancouver “parents” show new arrivals how to navigate public transport or get a library card, and organise donations of winter clothing or kitchenware, according to Ken Tung, one of the volunteers.

Tung said their aim is to “give them a stepping stone to move on.”

Alison, a protester who left Hong Kong last year after many of her friends there were arrested for taking part in protests, was one of those helped by the Calgary group.

Along with a few other new arrivals, she launched the Soteria Institute, named after the Greek goddess of safety and salvation, to offer free, weekly, online English lessons, resume-writing workshops and emotional support.

“We understand what they’re experiencing,” said Alison, who asked to be identified by only one name. “We try to use our experience to help out more Hong Kong exiles.”

Reporting by Sarah Wu in Ottawa
Editing by Marius Zaharia and Bill Rigby

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Hong Kong drinks company Vitasoy faces China netizen calls for boycott

A policeman takes pictures at the site where a man allegedly stabbed a police officer in Causeway Bay, during the 24th anniversary of the former British colony’s return to Chinese rule and on the 100th founding anniversary of the Communist Party of China, in Hong Kong, China July 1, 2021. REUTERS/Tyrone Siu

HONG KONG, July 4 (Reuters) – Beverage maker Vitasoy (0345.HK) has become the latest target of Chinese netizens’ calls for a boycott after an employee circulated a memo online offering condolences to the family of a worker who had stabbed a Hong Kong police officer.

In a statement on the Chinese social media platform Weibo on Saturday, Vitasoy said a staff member had circulated a memo that it described as “extremely inappropriate” without authorisation, and the company reserved the right to take legal action.

The memo offered condolences to the family of a 50-year-old Vitasoy worker who had stabbed a police officer, 28, and then killed himself on Thursday, the anniversary the former British colony’s return to Chinese rule, media outlets reported.

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“What this employee wrote should not have been made public and should not have been published internally,” Vitasoy said.

“Vitasoy Group sincerely apologises for any troubles or grievances this has caused. We support Hong Kong’s long-term prosperity, stability and development.”

Police have described the stabbing as an attempted murder. The officer’s condition has improved from critical to serious.

The worker’s memo triggered a flood of online calls for a boycott of Vitasoy, which gets two-thirds of its revenue from mainland China.

The hashtag “#Vitasoygetoutofthemainland” has garnered almost 100 million views.

Hong Kong authorities warned on Sunday that advocating for people to mourn for the attacker was no different from “supporting terrorism” and criticised parents who took children to mourn him.

The Police National Security Department said it had taken over the case and initial investigations showed it was a “lone wolf-style act of domestic terrorism, in which the attacker was believed to be radicalised by myriad fake information.”

It warned members of the public “not to tolerate or glorify violence.”

A 20-year-old woman and a 26-year-old man were arrested on suspicion of inciting others to commit murder, as well as arson and seditious intention, said police Superintendent Wilson Tam.

Tam did not specify whether the arrests were related to the stabbing, telling a news conference only that the pair were suspected of posting messages on social media on Friday. One of the messages incited people to kill police, he said, adding that more arrests could not be ruled out.

On Friday, people went to the scene of the attack, some with children, to pay their respects to the attacker and lay flowers.

Mainland actor Gong Jun, who previously endorsed a Vitasoy lemon-flavoured drink, announced late on Friday he was ending commercial cooperation with the company, said Global Times, a tabloid published by the ruling Chinese Communist Party’s official People’s Daily newspaper.

His announcement followed that of another mainland Chinese actor, Ren Jialun, who said he was also ceasing co-operation with Vitasoy, the newspaper added.

Fashion retailer H&M (HMb.ST) said on Thursday its sales took a hit in China after its concerns over alleged human rights abuses in Xinjiang led to a social media-inspired boycott by shoppers. read more

Reporting By Anne Marie Roantree and Jessie Pang in Hong Kong and David Kirton in Shenzhen; Editing by William Mallard

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China’s Didi raises $4.4 bln in upsized U.S. IPO -sources

  • Didi sold 317 mln ADS, more than planned 288 mln -sources
  • Sells ADS at $14 a piece – sources
  • Would give Didi $73 bln valuation on fully diluted basis

June 29 (Reuters) – Chinese ride hailing company Didi Global Inc (DIDI.N) raised $4.4 billion in its U.S IPO on Tuesday, pricing it at the top of its indicated range and increasing the number of shares sold, according to two sources familiar with the matter.

Didi sold 317 million American Depository Shares (ADS), versus the planned 288 million, at $14 apiece, the people said on condition of anonymity ahead of an official announcement.

This would give Didi a valuation of about $73 billion on a fully diluted basis. On a non-diluted basis, it will be worth $67.5 billion. The company is expected to debut on the New York Stock Exchange on June 30.

The increase in deal size came after the Didi investor order book was oversubscribed multiple times, one of the sources said.

Investors have been told to expect their orders to be scaled back once allocations are completed on Wednesday, according to a separate source with direct knowledge of the matter.

Didi did not respond to a request for comment.

The listing, which will be the biggest U.S. share sale by a Chinese company since Alibaba raised $25 billion in 2014, comes amid record IPO activity this year as companies rush to capture the lucrative valuations seen in the U.S. stock market.

Didi’s IPO is more conservative than its initial aim for a valuation of up to $100 billion, Reuters has previously reported. The size of the deal was cut during briefings with investors ahead of the IPO’s launch. read more

This suggests increasing investor worries about China’s potential anti-trust related crackdown and a more volatile IPO environment globally in 2021, said Douglas Kim, a London-based independent analyst, who writes on Smartkarma.

A Didi logo is seen at the headquarters of Didi Chuxing in Beijing, China November 20, 2020. REUTERS/Florence Lo/File Photo

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“But it seems like many investors like this deal, the volatile IPO environment helped to lower IPO price and valuation looks attractive,” Kim told Reuters.

Didi’s IPO was covered early on the first day of the book-build last week and the investor books were closed on Monday, a day ahead of schedule. read more .

An over-allotment option, or greenshoe, exists where another 43.2 million shares can be sold to increase the deal size.

DIDI HISTORY

Didi was co-founded in 2012 by former Alibaba employee Will Wei Cheng, who currently serves as the chief executive officer. Cheng was joined by Jean Qing Liu, a former Goldman Sachs banker and the current president of the ride-sharing company.

The company counts SoftBank (9984.T), Uber Technologies Inc (UBER.N) and Tencent (0700.HK) as its main backers.

Didi is also known for successfully pushing Uber out of the Chinese market after the U.S. company lost a price war and ended up selling its China operations to Didi for a stake. Liu Zhen, the head of Uber China at the time, is Didi’s Liu’s cousin.

Like most ride-hailing companies, Didi had historically been unprofitable, until it reported a profit of $30 million in the first quarter of this year.

The company reported a loss of $1.6 billion last year and an 8% drop in revenue to $21.63 billion, according to a regulatory filing, as business slid during the pandemic.

Its shares are due to start trading under the “DIDI” symbol.

Reporting by Echo Wang in New York and Anirban Sen in Bengaluru and Scott Murdoch in Hong Kong; Editing by Greg Roumeliotis, Bill Berkrot and Himani Sarkar

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