Permalink 01:47:00 pm, by dacare, 109 words, 18 views   English (US)
Categories: News of China

Microsoft to seal takeover of Nokia's handset business

Microsoft will complete its acquisition of Nokia's handset business this Friday, according to a Microsoft's statement, thus ushering a new chapter for Nokia.

In total, Microsoft will wrap up 5.4 billion euro ($7.5 billion) for the takeover this coming Friday.

"The completion of this acquisition follows several months of planning and will mark a key step on the journey towards integration," Microsoft said in Monday's statement.

Industry-watchers believe that this deal could open "a new chapter" for Nokia, rather than closing the book on the company.

With its market share greatly eroded, Nokia, once a giant of mobile phone business, fell victim of intense competition from its rivals Apple and Samsung.

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Permalink 11:01:36 am, by dacare, 170 words, 15 views   English (US)
Categories: News of China

Jobless rate 5.17 pct in march, survey says

China's polled unemployment rate in March was 5.17 percent, slightly lower than in February, said Li Pumin, secretary-general of the National Development and Reform Commission, on Wednesday.

It was the first reference to the jobless rate since Premier Li Keqiang mentioned it in an article in the Financial Times in September.

Traditionally, the government publicizes the urban registered unemployment rate. That number has long been criticized as a biased and deflated one. It also has rarely changed, staying at about 4.1 percent since 2010.

As an alternative, the government has administered a monthly survey in 65 major cities. The number is currently available only to policymakers and has not been made public.

Premier Li said in September that China's polled unemployment rate was 5 percent for the first half of 2013. Li Pumin did not elaborate on what the number was in February this year.

Citing the low unemployment and moderate inflation rates, Li Pumin said the economy is stable and healthy. As a result, the government does not foresee having to roll out stimulus measures.

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Permalink 03:58:30 pm, by dacare, 86 words, 28 views   English (US)
Categories: News of China

Toyota sells more than 10 million vehicles globally in FY 2013

Japan's Toyota Motor Corp. said Wednesday that its global group sales in fiscal 2013 gained 4.5 percent from the previous year to 10,133,000 units, becoming the first automaker whose annual sales topped 10 million units.

According to the corporation, the upbeat sales in the one-year period towards March were partly boosted by strong performances in North Korea and China. The consumption sales tax hike from April 1 also stimulated last-minute buying in domestic market.

The automaker also projects its group vehicle sales will total 10.32 million units in the next fiscal year.

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Permalink 02:21:53 pm, by dacare, 264 words, 32 views   English (US)
Categories: Banking & Financial Services

ZTE banks on patents to expand

ZTE Corp, a leading Chinese telecom equipment and smartphone manufacturer, aims to increase its presence in international markets and establish itself as a multinational firm through boosting the number of its patents.

"We've made the development of intellectual property rights our company's core strategy, especially when expanding to overseas markets," said Guo Xiaoming, vice-president of the company, which is based in Shenzhen, Guangdong province.

Guo said that if a company doesn't have a solid foundation in intellectual property rights, it will be very difficult to establish itself in overseas markets, especially in matured markets such as the United States and Europe.

"We've been putting the development of intellectual property rights on top of our company's agenda. We've also been investing heavily in research and development," he told a media briefing on Monday.

Guo said ZTE invests about 10 percent of its annual sales on research and development every year. It has injected more than 40 billion yuan ($6.42 billion) on R&D over the past five years.

According to a report from the World Intellectual Property Organization in March, ZTE filed 2,309 Patent and Cooperation Treaty applications in 2013, becoming the world's second largest patent filer.

Panasonic Corp of Japan – with 2,881 published applications — was the top applicant last year. ZTE was the top applicant in 2011 and 2012, while Panasonic headed the applicants' list in 2009 and 2010.

Rather than the quantity of patents, Guo said ZTE eyes their quality.

"The cost of filing a patent in Western countries is quite high — usually 50,000 to 80,000 yuan for each application. We only file those inventions that have the biggest potential in monetization," he said.

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Permalink 01:43:43 pm, by dacare, 618 words, 55 views   English (US)
Categories: News of China

Weibo makes debut on Nasdaq

Weibo Corp, Twitter Inc's counterpart in China, made its debut on the Nasdaq in the United States on Thursday, becoming the first publicly traded Chinese social media company.

The micro-blogging service, owned by Sina Corp and Alibaba Group Holding Ltd, priced its initial public offering at $17 per share, which was at the bottom of its planned range between $17 and $19. It opened unchanged at the issue price.

The Beijing-based company, which began trading publicly under the ticker WB, said it hopes to sell 16.8 million Class-A American depositary shares, less than its original plan of selling 20 million shares.

The IPO would allow Weibo to raise up to $328.44 million in capital. Twitter Inc raised $1.8 billion from its IPO in November 2013.

Charles Chao, chief executive officer and chairman of the board of Sina Corp, said the setting of any IPO price is based on demand and supply in the stock market.

"Because of the recent downturn of the IPO market in the US, we are happy that we can still set Weibo's IPO price at the bottom of our initial targeted range," Chao said at an online media briefing to a group of reporters on Thursday night Beijing time, ahead of the IPO.

Weibo, which reported a monthly active user base of 144 million as of March this year, first filed for its IPO on March 14, joining seven other Chinese Internet companies seeking capital in the US. That doesn't include China's e-commerce conglomerate Alibaba, which is approaching a highly anticipated IPO in the US.

Alibaba agreed a year ago to buy a 19 percent stake in Weibo for $586 million and plans to exercise an option to raise that stake to 32 percent.

Weibo was established in 2009. The company has only been profitable in the fourth quarter of 2013. The company reported a net loss of $47.4 million in the first quarter of this year. This is more than twice the $19.2 million loss it posted in the same quarter last year.

Revenues of $67.5 million in the first quarter of this year were more than double the previous year's, but they fell about 5.5 percent from the previous quarter. The company attributed the shrinking revenues to the seasonal effects of the Chinese Lunar New Year, saying the performance was in line with its expectations.

Analysts worried that Wall Street investors may not be as enthusiastic about Weibo as they were about Twitter's IPO five months ago.

Tian Hou, chief analyst with T. H. Capital LLC, an independent research and investment advisory firm, said it was no surprise Weibo failed to reach its initial target of raising $500 million as it suggested it would in its Securities and Exchange Commission filings.

"The primary reason is the downturn of the overall stock market in the US. Many US-listed Internet companies, such as China's e-commerce company Vipshop Holdings Ltd and China's search giant Baidu Inc, saw their share prices drop in recent weeks," Tian said.

Wang Xiaofeng, an analyst with US-based consultancy Forrester Research Inc, said Weibo missed the best time to go public because of the changing dynamic in the Internet industry in China, which has seen more powerful competitors emerging over the past year.

"We are all aware that it has been 'beaten up' by Tencent Holdings Ltd's WeChat, which is the most popular messaging app in China's mobile Internet sector," she said.

According to Wang, the two platforms differ in their potential for public broadcasting and promotional use, to which Weibo is currently better suited.

"The biggest challenge for Sina Weibo therefore is finding a way to increase the targeting ability of its current advertising and provide more effective marketing offerings to marketers before they find alternative social platforms on which to market or before user activity drops further," she said.

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Permalink 11:21:14 am, by dacare, 579 words, 52 views   English (US)
Categories: News of China

Zurich Insurance hunts for M&A targets in China

Swiss giant, attracted by possibilities for growth, seeking Shanghai branch

Zurich Insurance Co Ltd is actively seeking merger and acquisition opportunities in China to fuel its business expansion, a company executive said on Thursday.

"We are looking for appropriate M&A opportunities to boost our presence and expand our business scope," said Stuart A. Spencer, chief executive officer of general insurance for the Asia-Pacific region.

He said Zurich adopted a "defensive" stance during the global financial crisis. Now, thanks to a solid balance sheet, the company wants to be more aggressive.

"We have no preference as to whether the target should be a domestic one or an international one having operations in China, but it should be a strategic and cultural fit with our business," Spencer said.

Last April, the China Insurance Regulatory Commission approved the Swiss company's plan to transform its Beijing branch into a wholly owned subsidiary, making it easier to expand across the country.

Spencer said the company has since submitted an application to the CIRC to open a branch in Shanghai.

Zurich General Insurance Co (China) Ltd generated premium income of 496 million yuan ($80 million) last year, up 16.6 percent year-on-year.

"We expect to maintain a growth rate no lower than that this year," said Spencer. "And we aim to achieve a healthy profit margin within three years."

China's economic growth has been slowing, but Spencer said that the company is still extremely bullish on its business prospects in the nation.

"China's economy remains very resilient, and it is incredible for the world's second-biggest economy to maintain such rapid growth," said Spencer.

The country's economic restructuring to give consumption more of a role is good news for the insurance industry, he said.

According to Spencer, the company doesn't plan to be the largest player in the market. "We aim to generate underwriting returns, and we will not be seduced by mere rapid growth," said Spencer. "Massive scale never interests us, but we do want to be bigger than the scale we have right now," he added.

The company is closely watching conditions in the vehicle insurance market, but its focus remains on liability insurance and special financial insurance, according to Spencer. Profit margins in vehicle insurance are regarded as not very attractive.

China's continued urbanization and rising household wealth will sustain the growth dynamics in the country's nonlife insurance sector, but intense competition will further weaken the sector's underwriting margins in 2014, Fitch Ratings Inc said in a report.

In light of contracting underwriting margins, Fitch believes small insurance companies with limited operating scale and less diversified insurance books will post weaker operating results in the coming year.

Nonlife players are likely to see premium growth of 15 to 20 percent over the next 12 to 24 months, according a report by Standard & Poor's Financial Services LLC.

But the segment's performance can be volatile and subject to unexpected natural disasters. Inadequate pricing, or underestimated risk profiles, of commercial property and marine lines in China are likely to persist because of stiff competition, according to S&P.

Major listed Chinese nonlife insurers will still achieve growth in their underwriting surpluses, albeit at a slower pace, because of diverse revenue streams and better spread of risk.

"Ongoing business expansion coupled with slower surplus growth will continue to pose a strain on insurers' capital adequacy, although many insurers improved their solvency adequacy through fresh equity injections or subordinated debt issues over the past year," said Terrence Wong, director of insurance at Fitch.

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