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  • MeetChina.com raises $30 million

    B2B trade portal, MeetChina.com, has raised $30 million in its second funding round, led by venture capital firm Citicorp Capital Asia. The group, which provides trading facilities for buyers and sellers of mainland China goods, raised $10.8 million in its first financing round in January.

    The new investors in the company are Ayala Ventures, the venture capital arm of Ayala Group of the Philippines; Hong Kong-listed Hikari Tsushin; MC Capital, a wholly owned subsidiary of Mitsubishi of Japan; Archipelago Group; Bessemer Trust; The Stanley Works; Thomas Vickers Investment Group (China Investors), and Total Film Group. Citicorp, One Motorola Ventures and First Data, which invested in the first round, also participated in the second. The deal is remarkable for its size and the fact that it was achieved at the time of the continuing consolidation in the internet sector.
  • SingTel invests $400 million in Bharti Group of India

    Singapore Telecommunications’ (SingTel) bid to expand its operations across the region assumed a higher profile with the signing of an agreement to invest $400 million in the Bharti Group, India’s largest private telecommunication services group. SingTel is acquiring a significant minority stake in the company through Bharti Telecom and Bharti Televentures, the holding companies of the group’s telecom services companies.

    SingTel’s investment is the largest by a Singaporean company in India’s telecom industry and the third largest overseas investment for SingTel.

    Says SingTel president and chief executive officer Lee Hsien Yang: “SingTel chose Bharti as its partner because we were impressed with the vanguard role the group has played in the development of Indian telecommunications.”

    Sunil Bharti Mittal, chairman and group managing director of Bharti Enterprises, says the partnership is the beginning of a new era of cooperation between India and an Asian powerhouse.

    SingTel and Bharti will work together to develop projects in the Saarc (South Asian Association for Regional Cooperation) region across the telecommunications spectrum, including domestic and international long distance, cellular and fixed line, and submarine cabling. The two companies started their partnership with the signing of a memorandum of understanding to explore the prospects of constructing a submarine cable system linking Singapore and Chennai (Madras).

    Bharti seeks to achieve a pan-India presence through the initiation of new projects and fresh acquisitions. It is expected that SingTel, as a strategic partner, will contribute technical expertise in the areas of next generation voice and data cellular and fixed networks.
  • PCCW buys control of Japan's Jaleco for $250 million

    Pacific Century CyberWorks (PCCW) is to take control of games software maker Jaleco of Japan in a Y27 billion ($250 million) deal. The investment will help PCCW develop Japanese language content for its new broadband internet and television service and gain a listing in Japan’s stock market through Jaleco.

    Todd Bonner, who will be chief executive of Jaleco, to be renamed PCCW-Japan, has predicted that 16 million Japanese households will have broadband — or high-speed, high-capacity connections — by 2005.

    He said three Japanese firms, together with other investors, will contribute a total of Y2 billion towards the Jaleco purchase, giving PCCW and its partners an 81 percent stake in the firm. The investors include advertising agency Dentsu, financial services firm Orix, and entertainment ticketing and lifestyle publisher PIA. When the deal closes in November, the renamed firm will remain listed on Tokyo’s stock market.
  • Flextronics acquires rival JIT for $640 million

    Flextronics International, Singapore’s fourth biggest electronic parts maker, will buy rival JIT for $640 million. Flextronics said it would pay S$4.38 ($2.55) for each JIT share through new Flextronics shares. JIT shareholders will get 32 Flextronic shares for every 1,000 shares they own, a scheme that will give JIT shareholders about five percent of Flextronics.

    Flextronics is on an investment binge, taking control of rival DII Group for $2.4 billion last year and buying Chatham Technologies early this month for $589.7 million.

    Salomon Smith Barney is advising Flextronics and ABN AMRO is advising JIT.
  • HSBC set to clinch bank purchase in the Philippines

    HSBC is close to forging an agreement to buy a thrift-banking unit of Equitable PCI Bank, the third largest bank in the Philippines, says a source familiar with the negotiations.

    “Equitable PCI has given [HSBC] its asking price and HSBC has indicated that it remains interested. There are indications that pricing will not stand in the way of an agreement being reached soon,” says the source.

    The source says Equitable PCI’s reported asking price of two times the book value for PCIB Savings Bank is well within the range of prices paid for banks over the past year. He adds the prospect for Equitable PCI and HSBC reaching an agreement is good despite a provision in the law, which restricts foreign banks from buying a local financial institution.

    On August 8 central bank governor, Rafael Buenaventura, said that Bangko Sentral ng Pilipinas would try to find a way out of the legal restriction to allow major foreign banks, such as HSBC, to expand their retail banking operations in the country. “What could happen is for Equitable PCI and HSBC to reach a provisional [sale-and-purchase] agreement which could later be confirmed by the [policy-making] monetary board of the central bank,” says the source.

    He says Equitable PCI does not foresee any difficulty in HSBC’s due diligence on PCIB Savings Bank because of its sound financial condition. As of the first quarter of the year, the bank had assets of P1.41 billion ($31.5 million), P531.19 million in loans and P695.57 million in deposits. It has 14 branches.
  • Hutchison Exits German Mobile Venture, Citing Cost

    Hong Kong, Aug. 18 (Bloomberg) -- Hutchison Whampoa Ltd., Hong Kong's largest conglomerate, said it's pulling out of a mobile phone venture in Germany with Dutch telecommunication operator KPN Mobile NV just hours after the consortium won a license to offer high-speed mobile Internet services for 8.39 billion euros ($7.69 billion).

    ``As a new entrant to the German market, the cost of the license is higher than Hutchison had anticipated,'' Canning Fok, group managing director of Hutchison Whampoa said in a press release. ``Hutchison Whampoa remains committed to its strategy to develop a pan-European third-generation business.''

    Hutchison's exit from the German business should reduce its financial burden and could help expansion in other European markets, according to one analyst.

    ``I think the implication will be positive from the financial point of view,'' said Robert Sassoon, an analyst with SG Securities. ''Obviously this means they don't have to spend that money now.''

    Though Hutchison said it is in talks with KPN to explore other forms of cooperation in Germany, the move is a retreat for the company, which had been forming partnerships to gain a foothold in Europe's mobile phone market. While Hutchison said it remains committed to developing the so-called `3G' services in Europe, the withdrawal from Germany raises doubts, analysts said.

    ``Germany will be a big gap in its strategy,'' said Sassoon, adding the move makes Hutchison's mobile phone ventures in France and Italy more critical. The U.S. market may also be an option, he said.

    Hutchison said it will sell a 50 percent stake in the E-Plus group at no loss to KPN, giving the Dutch company full ownership of the venture.

    The Hong Kong company said the license for a 10 megahertz frequency did not meet its needs because the consortium wanted a 15 megahertz spectrum providing more bandwidth.

    The sale of the Hutchison stake in E-Plus ``allows KPN Mobile to pursue its strategic objective in Germany, where they already have a substantial presence,'' Fok said.

    Hutchison fell as much as HK$3.50 to HK$114.50 in early trading on the Hong Kong stock market today.

  • Softbank pays $4.78 million for Morningstar Asia stake

    The Softbank Group has paid HK$37.34 million ($4.786 million) for a 20 percent stake in Morningstar Asia, a company that provides information on investment funds. Morningstar Asia is controlled by Hong Kong-listed Pacific Century CyberWorks (PCCW) through its wholly owned Advanced Internet Visions. The Japanese internet investment group is also a shareholder in US-based Morningstar Inc.

    Two Softbank units, Softbank Strategic and Softbank Finance, will each acquire 1.867 million shares of Morningstar Asia, each paying HK$18.67 million. Once the agreement is completed, PCCW will hold 40.1 per cent of the company while parent Morningstar Inc will own 39.9 per cent.

    Morningstar Asia plans to build consumer-oriented financial websites in Asia, offering data and customised editorial on each country’s domestic stocks and mutual funds. It also wants to provide investors in the region access to its investment screening and portfolio building tools.
  • Asia Online buys stake in Indian ISP

    Internet service provider (ISP) and applications service provider (ASP) Asia Online has acquired a majority interest in India Domain Web Services, a web development services company that provides e-commerce solutions, internet consulting and portal management. Asia Online says it has set up an Indian subsidiary and has obtained government approval for downstream investment.

    India Domain Web Services is a past recipient of the Top 5 Percent of Web Sites award presented by Lycos and is listed in the “Top 25 Indian Web Sites” by PC World.
  • ImpactNET Forms Strategic Partnership with Lycos Asia

    Philippine Internet users can now … access everything…

    Manila, Philippines August 22, 2000 ImpactNET, the Philippine’s fastest growing Internet Service Provider of Singapore based Impact Digital Media Group (IDMG) today announced a strategic partnership with Lycos Asia, a US$50 million joint venture between US-based Lycos, Inc and Singapore Telecom.

    Under the agreement with ImpactNET, Lycos Asia will be powering the ISP’s website in the Philippines. The site of ImpactNET will be upgraded over the next few months to leverage the synergy of content and community with access and infrastructure. This in turn will form a solid foundation for the emerging commerce market in the Philippines.

    Ms. Mary Ong, CEO, Lycos Asia said today,” We strongly believe in bringing Asian users the most exciting and fulfilling on-line experience available today. Localization is key in our endeavor to engage a culturally diverse audience in Asia. We have demonstrated that we have done well in all the countries that we have launched and are entering the Philippines with the same goal in mind.”

    "We are constantly evaluating what we provide on our website and continuously adding features that are appealing and responsive to our users needs," said Mr. Rodney Banzon Consunji, Senior Managing Director of the ISP, ImpactNET and Vice President – Business Development of IDMG. "By partnering with Lycos Asia, it will increase the depth and breadth of the relevant content and services available to our users."

    In addition to content, Lycos Asia will offer its world-class Internet services and tools that facilitate web navigation and encourage community building. These include Lycos powered search engine, local directories, free web-based email and web-building services. Tripod Asia’s free homepage-building site provides an easy way for both consumers and businesses to build their own content and Web pages, and encourage relationships and activities around their own communities of interest. MailCity Asia’s free web-based email services enables users to communicate and collaborate with each other throughout the global medium.

    "We are happy about this partnership with ImpactNET as it marries the best of our respective strengths as providers of Internet access and Internet content and services. This synergy allows us to not just effectively deliver our rich content to a much wider customer base but also gives us the leverage to attract more and varied content and product partners. This, in turn, translates into a greater variety of customized content and services for the benefit of our users." said Ms Ong.

    “We at the Impact Digital Media Group are constantly evaluating what we provide on our websites and continuously adding features that are appealing and responsive to our users needs. With ImpactNET partnering with Lycos Asia, it will increase the depth and breadth of the relevant content and services available to our users. We are excited about these new developments... and we are determined to help you make the most of them. That's what "ImpactNET - access everything..." is all about... bringing more people into the world of interactive services, and making the online experience an even more valuable part of people's lives,” said Mr. Consunji.

    The Philippine Internet industry and e-commerce environment is currently in an exciting phase of its development. The Internet user population and PC penetration are fast growing. The audience is young, dynamic, multi-lingual and well educated. It is important for us to establish ourselves here early in our growth. The time is right for us to make the investment that we need to build our presence, and integrate with the regional communities to develop the most compelling on-line experience that the Internet users here deserve. This also positions us well to expand very quickly into the rest of Southeast Asia in the near future.

    “We'll continue to enhance IDMG and make the promise of "ImpactNET - access everything..." a reality, and while we'll continue to build our network so we can meet your needs and also the needs of our partners, employees, and shareholders, we realize we shoulder a responsibility that transcends improving our services and bettering our company. We recognize we need to take proactive steps now to ensure that we build a medium we can be proud of... a medium that has a positive "impact" on society. A medium only made possible by our partnership with Lycos Asia. “ said Mr. Consunji

    “We have only just begun to dream about how this medium is going to transform our lives and our society. It's a new world, and it's going to require fresh, bold thinking. At ImpactNET, we are excited by the challenges and the prospects, and we look forward to delighting you with new products, services and experiences. Our partnership with Lycos Asia is evidence that we are committed to constantly raising the bar and bringing you with us into a new world of even greater interactivity and connectedness. “ said Mr. Consunji.
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  • e-KONG’s US expansion

    The Hong Kong headquartered internet company e-KONG on September 7 announced that it had received US regulatory approval to acquire the long-distance telephone reseller, Furst Group.

    The Federal Communications Commission (FCC) on August 31 approved e-KONG’s purchase of Furst, estimated at $12 million.

    The acquisition, first announced on August 8, marks the company’s first step towards expansion into the $128 billion US telecoms market.

    e-KONG’s principal business is its Zone Group. Known in Hong Kong and Singapore as Zone1511, the company began its operations in Hong Kong and announced an expansion to Singapore on August 17.

    The e-KONG chief operating officer Derrick Bulawa says Furst’s most important asset is its client base of about 30,000. He says the most important aspect of the recent FCC ruling is that Zone can assume Furst’s clients without requiring the clients to go through a cumbersome, and off-putting, signing-up process. “It’s a home run,” says Bulawa.

    Zone allows consumers to select a ‘basket’ of international direct dialling (IDD) brands, and then chooses for the customer the cheapest carrier for a given call. The company owns no telephone lines or switching stations but takes a 15 percent cut of any revenue it generates through its service.

    Bulawa explains that with the Furst acquisition, there will be 30,000 clients automatically signed with Zone, and the firm will immediately be taking commissions from the revenue generated from this client base. He has not said which carriers have signed with Zone and admits that this is the key issue facing the group in that market.

    Bulawa says that Zone’s growth in the US will be through acquisitions similar to the Furst deal, and not through mass marketing and advertising campaigns.
  • Asia Tech, Swiss investors buy into e-bookstore

    Asia Tech Ventures has teamed up with two Swiss investors, publishing company Ringier and Zurich-based investment bank A&A Dragon (Panama), to invest $3 million in online Chinese language bookstore BooksCity.com, formerly ModernBooks.com.

    The Macau-headquartered company says the funds will enable it to further develop its website and increase its range of merchandise. The company provides discounted titles and is able to deliver books as efficiently as established online bookstore Amazon.com. US buyers can also get the books 60 percent cheaper than in US stores, claims chairman and CEO, Johnny Sitou. The company is also making a push into the business-to-business market to supply books from mainland China to other online bookstores catering to Chinese communities worldwide.

    “Our monthly burn rate is very low. Advertising costs account for less than five percent of our expenses,” says Sitou, who founded the company in August 1997. Sitou says he is planning to have a new funding round by the end of the year and will seek a listing if the market environment for internet companies turns favourable.
  • CMGI abandons fund venture with PCCW

    Internet investment company CMGI has announced that it will not proceed with the international fund it had planned to develop with Hong Kong internet company Pacific Century CyberWorks (PCCW) and Hicks, Muse, Tate and Furst.

    The company also announced a reorganisation of its business to clarify its complex structure. CEO David Wetherell said the move would improve focus and provide greater clarity.

    He has reorganised17 majority owned holdings into six separate lines of business, divided by industry segments into search and portals, infrastructure and enabling technologies, internet professional services, interactive marketing, and e-business and CMGI’s venture capital business, [email protected] Furthermore, three of CMGI’s recently formed funds will be combined into one evergreen fund to be called [email protected] IV.
  • Hong Kong’s MTRC to announce IPO launch

    According to a source close to the company, the three managers of the Mass Transit Railway (MTRC) IPO are meeting over the weekend to finalise details for its launch and we can expect an official announcement on September 11. This should ensure that the actual listing occurs before the month’s end. Goldman Sachs, UBS Warburg and HSBC Investment Bank are managing the sale.

    Detractors of the deal believe it is more of a property play than a utility. However, one investment banker comments that pre-marketing completed so far has been greeted positively by investors. “Those who are cynical about the IPO are not seeing the bigger picture,” he says. “This is going to be an index stock and it’s a simple proxy to Hong Kong’s economy. The deal will be comfortably oversubscribed.”

    The sale is thought to be worth around HK$10 billion ($1.3 billion).
  • Asia Global Crossing to roadshow
    Integrated internet services provider and telecommunications carrier Asia Global Crossing starts its roadshow on Monday, with presentations to investors in Tokyo before moving on to Singapore and Hong Kong. Salomon Smith Barney and Goldman Sachs are joint global coordinators for the deal.

    According to a source close to the company, the deal, a New York-listed American depository share (ADS) should be worth between $750 million and $850 million. “I think the company should be able to achieve the higher end of the indicative range,” says the banker, which is between $14 and $16 per unit.
  • Back to backdoor listings

    In the meantime, backdoor listings on the Australian Stock Exchange (ASX) are back in vogue. Such listings were popular before April’s tech shakeout as unlisted companies sought ASX entry, especially through mining companies. Mineral explorer AMX Resources intends changing its name to Third Rail and will focus on wireless broadband services. The company is seeking A$22 million and will relist on September 19.

    Another mineral explorer, Mt Lyell Mining, will acquire a 50 percent interest in Automatic Communications and be renamed Oriel Communications. The company is seeking A$16 million and will relist on September 26.

    Gold miner Money Mining intends to acquire internet company Satcom and will change its name to Rambora Technologies. The company is seeking A$5.5 million and will relist on September 28.
  • SingTel plans more acquisitions

    Singapore Telecommunications (SingTel) says it will continue exploring “win-win” investment opportunities in the region.

    The Indonesian government has said that it would invite some of the world’s biggest telecommunications companies, including SingTel, to invest in its soon-to-be liberalised telecommunications sector.

    SingTel declined to comment on the Indonesian government’s overture and specific investments that it is considering, but has revealed its plan to eventually link up its mobile investments in various parts of the region to enhance services to its customers. “We are working to form a regional cellular network by grouping the 4.8 million subscribers of SingTel Mobile and [those of] our associates — Globe Telecom of the Philippines, Advanced Info Services of Thailand and the Bharti Group of India. Our combined subscribers can then benefit from preferential roaming arrangements and cheaper handsets, for example, as a result of greater discounts on bulk purchases,” says a SingTel spokesman.
  • Hewlett-Packard in Talks to Buy PricewaterhouseCoopers Unit

    Palo Alto, California, Sept. 10 (Bloomberg) -- Hewlett- Packard Co., the world's No. 2 computer maker, is in talks to buy PricewaterhouseCoopers LLP's consulting business for as much as $18 billion in cash and stock to provide customers advice on its information systems, a person familiar with the situation said.

    The purchase price could reach $20 billion, a second person said. The higher price was reported earlier by the Sunday Times of London. The Financial Times' online edition said the unit could fetch between $15 billion and $20 billion.

    Hewlett-Packard Chief Executive Carly Fiorina is seeking to add more consulting services to offer to potential buyers of its computer systems. Rivals such as International Business Machines Corp. already offer these services.

    ``I have no comment,'' Hewlett-Packard Chairman Richard Hackborn said in a brief telephone interview.

    Pricewaterhouse, a closely held company with 2,000 partners, said in February it plans to separate its auditing and consulting divisions, as the Securities and Exchange Commission increases pressure on accounting firms to split those businesses to avoid conflicts of interest. A Pricewaterhouse spokesman declined to comment.

    The talks between Hewlett-Packard and Pricewaterhouse may not result in an agreement, the people said. Any agreement would also have to be approved by Pricewaterhouse's partners.

    Hewlett-Packard is seeking to boost revenue in its computer server division, the unit that sells powerful computers that run Web sites and corporate computer networks. The company currently relies on both internal and outside consultants.

    In its fiscal year ended October 1999, the computer maker received $5.9 billion from its information technology services, which include consulting and customer support, according to the company's financial statements.

    For Pricewaterhouse, the sale would address concerns of the SEC, which in June proposed rules that would expand restrictions on the ability of firms to design and install large information and computer systems while providing audits for the company.

    ``For investors to have confidence in the quality of the audit, the public must perceive the accountant as independent,'' SEC Chairman Arthur Levitt said in a speech last May.

    Hewlett-Packard shares fell 2.81 on Friday to 121.

  • Pacific Century CyberWorks share price fell to the lowest point this year yesterday as investors continued to sell ahead of an expected placement by 20% shareholder Cable &
    Wireless. The shares have fallen for six consecutive days, and as part of a wider sell-off in telecommunication plays CyberWorks shares fell 5.3% to HK$11.50.

  • The Hong Kong government has removed three subsidised housing sites from its tender sales list in what is being viewed as a sign of further intervention to prop up the private property market. The changes were announced yesterday as part of changes to this financial year’s land sales programme. Three Private Sector Participation Scheme sites sufficient to produce 7,300 flats have instead been put on what is known as the application list. This means that the site sin Kwai Chung, Sha Tin and Tseung Kwan O will not be released for sale until developers express an interest and a minimum purchase price is agreed.

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