Archive for November, 2009
A recent side-by-side comparison of the U.S. and Chinese economies produced a startling result: There were $34.8 billion of initial public offerings in China this year and only $13.7 billion in the U.S.
With numbers like that, is it any surprise that Western fund managers are scrambling to get a bite of the immensely profitable Chinese market for new companies? As the New York Times reported, U.S.-based Blackstone Group has formed a partnership with Shanghai’s municipal government to raise a $732 million private equity fund.
What’s different this time is that Blackstone’s fund is denominated in the Chinese currency, which is officially called the renminbi. Blackstone’s idea is to take advantage of capital from China’s increasingly wealthy institutional and private investors. The fund will then use the investments to buy companies and take them public, earning a hopefully large profit along the way. There is plenty of interest in the Chinese market for new companies—Carlyle Group announced this week that it had invested $60 million in three Chinese growth companies. So there is no shortage of domestic companies ripe for turnaround [Source].
A few weeks ago, Stephen A. Schwarzman, the chairman of the Blackstone Group, the world’s biggest private equity firm, signed a joint venture here with Shanghai’s municipal government, creating the first Blackstone fund denominated entirely in Chinese currency.
The $732 million fund was the latest example of two trends: global private equity firms seeking to raise capital from increasingly wealthy Chinese individuals and institutions, and the growing international stature of the Chinese currency, formally known as the renminbi.
According to Zero2IPO, a Beijing-based research firm, more than 190 funds denominated in renminbi have been established in the last two and a half years with a combined total of more than $30 billion. In the past, investments in Chinese companies were largely done through offshore holding companies in tax havens like the Cayman Islands.
Chinese private equity funds are emerging in big cities as China promulgates new regulations aimed at creating a homegrown private equity industry, one that Beijing hopes will strengthen the country’s capital markets and fuel private sector growth in an economy overly dependent on government investment [Source].
Companies that create applications for Twitter are diversifying, preparing for a day when they may no longer be needed.
With a $1 billion valuation, plenty of money in the bank, and new deals with Google and Microsoft, Twitter could easily roll out applications to compete with its developers.
Google and Microsoft get the chance to mine the wealth of data—keywords, trends, links—rising and falling across Twitter in real time, a boon for both companies’ advertising networks. And Twitter’s 50 million users, who send messages that are up to 140 characters long, can now better monitor the company they’re keeping and tweet appropriately [Source].
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Google is using its domination of search advertising to confront Amazon, Microsoft, Apple, and others. It can’t possibly succeed everywhere at once. Or can it?
In just 11 years, Google has evolved from a pair of graduate students noodling in a garage to what may be the most disruptive force the business world has ever seen. Its meteoric rise has been driven by its mastery of technology and business strategy.
With a 71 percent share of the U.S. search market under its command, Google is looking for a way to maintain its incredible rate of growth [Source].
Google’s biggest mobile play was released last Friday, when Motorola releases its Android 2.0-powered Droid. The Droid is aimed straight at Apple’s iPhone. Will Google and its partners succeed where others have failed in dethroning the iPhone?
Google’s Android 2.0 mobile operating system will get a huge boost from Verizon, which says its Droid phone knows more tricks than the iPhone. Do those tricks include minting money like Apple? [Source]
Stimulus spending and other emergency measures have set the stage for global economic recovery, but nations must push ahead with free trade and investment to ensure growth, President Barack Obama and fellow Asia-Pacific leaders said Sunday.
Obama and 20 other leaders, meeting in Singapore for the annual Asia-Pacific Economic Cooperation forum, rejected protectionism and agreed to develop long-term strategies that take into account the diverse needs of economies in a region stretching from Chile to China [Source].
Former Merrill Lynch CEO John Thain offers his opinions as to what caused the crisis, what can be done to prevent it from happening again, and when it will be over — not just for the financial industry but also for Main Street. This lecture consist out of three videos, which include Thain’s remarks to the audience, questions from the three-member panel and, finally, questions from the audience.
Part 1-3 (Thain’s introduction)
Part 2-3 (Questions from the Panel)
Part 3-3 (Questions from the audience)
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