Coca-Cola to Invest $2 Billion in China Over 3 Years
March 6th, 2009March 6 (Bloomberg) -- Coca-Cola Co., the world’s largest soft-drink maker, plans to invest $2 billion in China over the next three years as part of its attempt to win more of the nation’s 1.3 billion consumers.
The investment plan includes a $90 million technology center that opened in Shanghai today, the Atlanta-based company said in an e-mailed statement. Coca-Cola’s proposed investment is 25 percent more than the $1.6 billion it had already spent in China since returning in 1979.
Beverage companies including Coca-Cola and PepsiCo Inc. are expanding in China, betting demand will continue to grow as the recession erodes consumer spending in the U.S. Coca-Cola’s planned spending may also aid its $2.4 billion acquisition of China Huiyuan Juice Group Ltd., which was announced in September and is now awaiting government approval.
“Coca-Cola’s investment is a positive for the Huiyuan acquisition,” said Kevin Luo, a consumer goods analyst with Guotai Junan Securities HK Ltd. in Shenzhen, southern China. “This investment will help create jobs, which would obviously be welcomed by the government, so even though it won’t have a direct impact on the acquisition’s approval, it can’t hurt.”
Pepsi said on Nov. 3 it plans to invest $1 billion in China in the next four years. Japan’s Asahi Breweries Ltd. in January paid $667 million for a 19.9 percent stake in Tsingtao Brewery Co., China’s biggest beer company.
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Coca-Cola controls 54 percent of the Chinese soda market and Pepsi 31 percent, according to research company Euromonitor International.
Retail spending in China may rise 14 percent this year, the National Development and Reform Commission, the nation’s top economic planning agency, said in a report distributed yesterday to the country’s legislature. China has also cut taxes and increased welfare spending in a bid to boost consumer spending amid the worst financial crisis since the Great Depression.
“It’s wise for international companies to invest in China, especially at a time when China is trying to boost domestic consumption,” said Kenny Tang, executive director of Redford Securities Co. in Hong Kong. “There’s still room for growth.”
Coca-Cola’s sales by volume rose 19 percent last year in China and declined by 1 percent in North America, according to the company’s annual report.
“Our commitment and confidence in China never wavers,” Coca-Cola Chief Executive Officer Muhtar Kent said in today’s statement. The company will invest in new plants, distribution and sales and marketing, Kent said.
Coca-Cola and Huiyuan, which applied for approval from China’s Ministry of Commerce in September, said then that they expected a government decision by March 23.
“We are in very regular contact with the Ministry of Commerce, and we try to be as helpful as possible in answering questions and providing supplementary information,” Kenth Kaerhoeg, a spokesman for Coca-Cola Asia, said by e-mail today.
Tigermed, MacroStat forge Chinese CRO alliance
March 5th, 2009Win-win Cooperation Between China Leading CROs, Boosting Full Service Capability
HANGZHOU, China, March 3 /PRNewswire-Asia/ --
Tigermed Consulting Co., Ltd, a leading Contract Research Organization (CRO) in China, and Qiming Venture, a premier venture capital firm based in Shanghai join hands to grant asset injection to MacroStat, the unique CRO in China specialized in clinical data management and statistical analysis. The union between the two top CROs will significantly improve Tigermed's clinical data management serviceability and broaden MacroStat's business line.
''MacroStat has the leading talents and system in biostatistics, with absolute competitive advantage in China. Tigermed and MacroStat shall establish extensive strategic partnership in the management of clinical trials, data management and statistical analysis. Tigermed accumulated outstanding expertise in clinical trials, while MacroStat is an expert in biostatistics. Our cooperation shall expand Tigermed's business line and add professionalism to Tigermed's biostatistics services. The win-win cooperation between leading CROs with complementary advantages is conducive to constructing a higher level of CRO service chain and further updating full service capability, which also opens a fast track to the globalization of China CROs,'' comments Dr. Ye Xiaoping, CEO and founder of Tigermed.
Ms. Cao Xiaochun, Vice President of Tigermed, added, ''Tigermed pays close attention to MacroStat advantage in data management and statistical analysis. Besides Ms. Cao Xiaochun, Dr. Ye Xiaoping (CEO and founder of Tigermed) and Hu Xubo (Director of Healthcare Investment Sector of Qiming Venture) will also join in MacroStat's board of directors. The cooperation between Tigermed and MacroStat will not only satisfy global clients with international standards but also power the innovative drug development in China, making it possible to streamline clinical research cycle and considerably reduce drug R & D costs.''
''MacroStat has set up strategic partnerships with many multinational pharmaceutical and biotech companies and international CROs, and has become their preferential biostatistics vendor. MacroStat's customers are mainly from USA and Europe. With the new capital, MacroStat will further accelerate its development effectively, on one hand, keeping the unique advantage in biostatistics, one the other hand, extending business line into clinical trials, so as to provide more extensive and comprehensive services for the pharmaceutical industries.'' Comments Helen Yin, managing director of MacroStat China.
About MacroStat
MacroStat, an international CRO, founded in 2002 in USA, is one of the few professional CROs dedicated to providing clinical data management and statistical analysis services. MacroStat is specialized in providing data and safety monitoring board (DSMB) support for USA FDA, and statistical support to FDA, CVM, EPA, MAA, MCA and other agencies and Asian countries. MacroStat (China) was established in 2005 in Shanghai, and now becomes the unique CRO focused on biostatistics in China
About Tigermed
Tigermed Consulting Co., Ltd, a leading Contract Research Organization (CRO) in China, is expected to become the largest CRO in China within 3 years. With capital injection from Qiming Venture in 2008, Tigermed has entered into a period of rapid expansion. The combined asset injection to MacroStat marks a stride forward in Tigermed's internationalization strategic development. The extensive cooperation between Tigermed and MacroStat allows both to make a big step forward.
Survey: 23% of China firms to freeze executives' salaries
March 5th, 2009A report by the human resources consulting firm Mercer shows that 23 percent of companies surveyed in China said their senior executives' compensation in 2009 wouldn't increase as usual, showing the effects of the global financial slowdown.
The survey involved 59 companies in China, 76 percent of which were listed companies and 39 percent of which were multinationals. Mercer conducted similar surveys in other Asian countries, including India, South Korea, Japan and Singapore.
"In Asia, one third of companies surveyed said their senior executives' salaries wouldn't increase in 2009. The proportion in China is a little smaller than the average, reflecting China experiencing less impact of the financial crisis than other Asian countries," said Zheng Wei, managing director for Asia executive remuneration business with Mercer.
"Considering the deferred impact on China's market, we predicted that more companies in China will take similar measures to limit the senior executives' salaries in 2009," Zheng added.
China: Labor disputes up 95 percent last year
March 4th, 2009BEIJING: Labor-related lawsuits nearly doubled in China last year mainly due to mass factory shutdowns, a senior official with the Supreme Court said.
A manufacturing powerhouse, China's factories were hard hit when overseas demand for their exports evaporated in the wake of the global financial crisis.
Shen Deyong, vice president of the Supreme People's Court, said at a news conference Monday that the number of labor-related lawsuits filed in 2008 jumped 95 percent, marking the biggest on-year increase of any type of suit.
He said most of the cases were filed in the country's coastal southeast, home to a string of factory hubs. In some areas, labor suits increased about 200 percent compared to 2007, he said, without giving specific figures.
The spike in labor lawsuits was "closely connected to businesses slumping and factories being shut down," he said.
"When they face difficulties, these businesses often reduce their costs by cutting the labor force and salaries," he said.
He said a new labor contract law that came into effect at the start of last year and rising public awareness of worker's rights also contributed to the rise in cases.
Unemployment is a major concern for China's communist leadership because of fears it could trigger social unrest and demands for political reform.
Taiwan's Hon Hai increases workforce in China
March 4th, 2009TAIPEI, March 4 (Reuters) - Taiwan electronics giant Hon Hai (2317.TW) said on Wednesday it had recently increased its number of employees in China by 5 percent despite the global downturn.
"In the short term, things are not as bad as they are made out to be," Chairman Terry Gou said at a signing ceremony between the company and IBM (IBM.N) on using green technology.
Gou did not specify when the company had increased its China workforce.
Hon Hai is a contract manufacturer that makes some of the world's most famous gadgets, including Apple's (AAPL.O) iPhone, Nokia (NOK1V.HE) cellphones and Nintendo's (7974.OS) Wii game console.
(Reporting by Kelvin Soh; Editing by Jonathan Hopfner)
McDonald's names new China chief executive
March 3rd, 2009BEIJING, March 3 (Reuters) - McDonald's Corp (MCD.N) on Monday named Kenneth Chan as its new chief executive officer in China, replacing Jeffrey Schwartz, the company said in a statement.
Chan, a Singaporean, has been with McDonald's for 12 years, most recently acting as regional manager in Malaysia, Taiwan and Korea, and managing director of its restaurants in Singapore.
Schwartz, a 40-year McDonald's veteran, will retire from the company, the statement said. (Reporting by Michael Wei; Editing by Ken Wills)