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from Breakingviews:

Hong Kong needs to defend shareholder democracy

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By Una Galani and Peter Thal Larsen

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Hong Kong needs to make a stand for shareholder democracy. Alibaba’s decision to shift its giant stock market listing to the United States has sparked a debate about control of public companies in the former British colony. Hong Kong’s stock exchange, whose rules wouldn’t have permitted a plan to let Alibaba insiders nominate a majority of board directors, is preparing a public consultation on shareholder rights. But dumping the principle of “one share, one vote” would be a mistake.

For a city that likes to bill itself as China’s gateway to global capital markets, missing out on the initial public offering of the largest e-commerce company in the People’s Republic is a symbolic blow. The snub raises fears that other fast-growing Chinese companies will choose to raise capital elsewhere, leaving the Hong Kong exchange as a stagnant backwater dominated by local tycoons and stodgy Chinese state-owned companies. Weibo, another hot Chinese tech company, is also planning a New York IPO.

In the United States, insiders can control public companies even when they no longer own the majority of the shares. Google and Facebook – to name just two of the companies Alibaba views as its peers – have blazed a trail by creating multiple classes of shares with different voting rights.

from Breakingviews:

WH Group’s quick pork flip serves up meaty return

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By Una Galani 

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

WH Group’s quick pork flip will serve up a meaty return. The Chinese pig producer hasn’t had much time to justify the 31 percent premium it paid for rival Smithfield less than seven months ago. Yet the planned relisting of the enlarged group in Hong Kong implies the value of the U.S. business has risen at least 21 percent.

from Breakingviews:

China stock market opening is opposite of Big Bang

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By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s approach to opening up its stock market is the opposite of a Big Bang. Investors are once again getting excited about the prospect of mainland shareholders being allowed to buy Hong Kong stocks. But such hopes have proved premature before. As with any loosening of China’s capital controls, progress is bound to be gradual.

from Breakingviews:

OCBC’s Chinese ambition comes with hefty price tag

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By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Oversea-Chinese Banking Corp is paying a hefty price to expand in the People’s Republic. The Singaporean group is realising a long-held ambition by splashing out almost $5 billion for Hong Kong’s Wing Hang bank. But the deal looks expensive at a time when growth on the mainland is slowing and the U.S. Federal Reserve’s tapering is threatening to push up deposit costs.

from Breakingviews:

CITIC’s $41 bln mega-merger needs fancy footwork

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By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

CITIC’s $41 billion mega-merger will need some fancy footwork. The Chinese state-owned conglomerate wants to reverse most of its assets, which include stakes in banks, brokerages and resources, into Hong-Kong listed subsidiary CITIC Pacific. There’s something in it for both sides, but the deal will require creativity to ensure it looks good financially for both the Chinese state, and CITIC Pacific’s minority shareholders.

from Breakingviews:

Li Ka-shing de-risks with $6 bln Temasek sale

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By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Li Ka-shing is de-risking. The Hong Kong tycoon has ditched plans to list his retail division AS Watson in favour of selling a 24.95 percent stake to Temasek for $5.7 billion. The deal crystallises a decent valuation for Li without the uncertainties of an initial public offering (IPO). For the Singaporean state fund, it’s a bold bet on consumer growth and private investments.

from Breakingviews:

Li & Fung revival depends on more than split

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By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Li & Fung has embraced financial engineering. The Hong Kong trading house, which grew to prominence by helping Western companies find cheap factories in Asia, has announced plans to spin off its branding arm into a separate unit. Though investors welcomed the news, any sustained re-rating requires both bits of the company to demonstrate they can deliver organic growth.

from Breakingviews:

Li Ka-shing dual listing plan more than cosmetic

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By Una Galani

The author is a Reuters Breakingviews columnist.  The opinions expressed are her own.

Li Ka-shing’s dual listing plan may be more than just a vanity project. The tycoon wants to float his A.S. Watson unit in London or Singapore as well as Hong Kong. For most companies the attractions of multiple listings are skin deep. But if the retail group can claw its way into several benchmark indices, it could prove an exception.

from Breakingviews:

IPO flops will come back to haunt Li Ka-shing

By Una Galani
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Li Ka-shing’s stock market flops will come back to haunt the tycoon when it matters most. His latest spinoff, utility HK Electric, has become the third listing in a row from the businessman’s energy-to-telecoms empire to fizzle. Though markets are soft, Li’s reputation for selling at the top may make it harder to get a premium valuation if he decides to press ahead with an initial public offering (IPO) for his prized health and beauty retail business, A.S. Watson.

from Breakingviews:

Hong Kong investors see double with nightclub IPO

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By Robyn Mak

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Hong Kong’s nightclubs are attracting a different breed of partygoers: the city’s mom and pop investors. Magnum Entertainment, which operates three local clubs, saw its shares more than double on their debut on Jan. 23 in an offering which shattered records for retail demand. Novelty, rather than financials, is fuelling the hype.

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