Lessons from Autohome Inc’s Battle With Foreign Shareholders (Bloomberg)
Telstra’s plans to sell a 48% stake in Autohome Inc (NYSE: ATHM) to Ping An Insurance Group Co. for $1.6 billion has ATHM’s Harvard-educated CEO James Qin leading a rebellion to derail the deal by making a rival bid and taking legal action. The battle pits China’s biggest car-information website against the Australian telecommunications giant and China’s second-largest insurer.
Bloomberg has a good piece summarizing all the action in the battle with the main lesson being that regardless of who ultimately wins, the dispute could influence how Chinese startups perceive the risk of taking in foreign investors and vice versa.
Qian Wenying, the Shanghai-based head of research at Analysys International, was quoted by Bloomberg as saying:
“What is happening at Autohome can be an excellent case study for a lot of Chinese startups. The lesson out of Autohome’s case is that no matter how badly a startup company needs capital, they need to realize that investments can work as a double-edged sword and may jeopardize management’s control over the company later on.”
The battle is also the latest in the growing number of contested management buyouts in China.
It should be noted Autohome Inc is scheduled to report financial results for the first quarter of 2016 before the U.S. market opens on June 1, 2016.
To read the whole article, Inside the Rebellion at China’s Largest Automotive Website, go to the website of Bloomberg. In addition, check out our China closed-end fund list and China ETF list pages.
- China Loses #2 Creditor Rank to Germany (Bloomberg)
- China’s $246B Foreign M&A Buying Spree Is Slowing (Bloomberg)
- The Definition of Successful Investing to Affluent Chinese (The Asset)
- How Big of a Threat is China’s Xiaomi to Apple? (Bloomberg)
- Lessons From a Decade of Chinese Stock Trading (WSJ)
- M&G Investments’ Vaight: “Chinese Firms Can Become Globally Competitive” (FE Trustnet)
- China’s Gung-ho Foray Into Africa Gets a Reality Check (Bloomberg)
- AmCham China: 60% of Foreign Companies Feel Unfairly Targeted
- China M&A a Bright Spot Amid Regional Decline (The Asset)
- Wal-mart Goes Native in China (AP)