Asia-Pacific

Foster’s gets full measure from SABMiller

21 Sep 2011

Boozy rows between the Australian and UK brewers are history. Like most hostile M&A, this has turned friendly with a sweetener from SAB. Torrid markets and the absence of rival bidders mean Foster’s has done especially well to extract a punchy $10 bln-plus cash offer.

Singapore not quite helpless over UBS losses

21 Sep 2011

The city state’s sovereign fund is understandably disappointed with its investment in the Swiss bank. The 6.5 pct stake may still come good, especially if UBS directs future business to Singapore. Even so, GIC may want to rethink the wisdom of being a purely passive shareholder.

Lack of liquidity sucks safety from Asian havens

21 Sep 2011

Asia’s failure to develop larger securities markets is coming home to roost. Investors are beating a path for exits despite the region’s relatively strong finances. Their fear: a retreat by European investors could leave them marooned, unable to cash out without rocking prices.

China’s pursuit of stability risks greater stress

20 Sep 2011

Some claim China’s economy is a bubble set to burst while others think slowing growth and inflation warrant looser policy. Ethan Devine of Indus Capital argues that in fact China’s economy is both too hot and too cold, with structural reforms needed to bring it back into balance.

IMF’s education remedy won’t cure rich world ills

20 Sep 2011

The fund’s flagship yearly outlook laments a jobs crisis and rising inequality in wealthy nations. But its prescription of more education spending is unlikely to do the trick. Though desirable in many ways, such outlays aren’t the golden ticket economists often claim.

Man U investors can always vote with their feet

20 Sep 2011

The soccer club may list in Singapore with “stapled” securities that could entrench the Glazer family’s control. But though new investors may not get the voting power they’d like, that can be reflected in the price. If the idea sounds too tricksy, would-be backers can say no.

China’s taste for European loans leaves it exposed

20 Sep 2011

Borrowers tapping cheap dollars to beat tight credit at home have racked up $333 billion in foreign loans, as much as 60 percent from European banks. If Europe’s crisis forces those banks to turn tail, it could jeopardise a small, but important source of cheap liquidity.

China’s IPO delays could worsen capital crunch

20 Sep 2011

Two heavy equipment makers, Sany and XCMG, delayed plans to raise a combined $5 billion. That suggests another door closing for Chinese companies hit by slowing demand and tighter credit at home. For those facing cash shortages, weak global capital markets may be the last straw.

Mongolia’s bounty hunters must out-tough Genghis

16 Sep 2011

The windswept, agrarian Central Asian country might make global investors very rich if plans to develop its plentiful mineral wealth come off. But the land of Genghis Khan is still pretty wild. John Foley takes a look across the steppes at the opportunities and dangers.

Japan’s new funding plan is hopeful, yet remedial

16 Sep 2011

The new government’s plans to finance rebuilding by hiking taxes and selling stakes in companies like Japan Tobacco are welcome. But details of how the revenue will be raised are worryingly vague. Given the political hurdles ahead, Japan can’t afford to re-learn old lessons.

Ackman’s gamble on Hong Kong unlikely to pay

16 Sep 2011

The activist fund manager is betting Hong Kong will re-peg its currency higher against the dollar. That may make sense given divergent economies, but could hurt the city’s competitiveness and do little to combat inflation. Bets like Ackman’s only encourage authorities to dig in.

Euro-mess exposes Asia’s hot money soft spots

15 Sep 2011

A stampede for safety has sent many of Asia’s currencies diving and the cost of insuring its debt soaring. The retreat says less about Asia’s financial health than Europe’s. It’s a reminder that hot money is most dangerous not when it pours in, but when it pulls out.

China’s friendly blackmail of EU may do the trick

14 Sep 2011

Beijing has implied it will buy euro zone bonds if it is granted coveted “market economy” status. The balance of power is in China’s favour so there may be a temptation to say yes. But China isn’t a market economy. The better solution is for Europe to get its house in order.

China has too many graduates, not enough workers

13 Sep 2011

Supply of college graduates in China far exceeds demand. Blue collar workers are much less plentiful. Beijing is right to invest in human capital but university expansion has caused distortions in the job market. It needs to work on the imbalances created.

Jingdong IPO tests U.S. appetite for China stocks

8 Sep 2011

The Amazon lookalike, unknown outside China, hopes to raise up to $5 billion in a U.S. listing. Jingdong’s scale and growth speed are exciting. But rising doubts about Chinese Internet darlings will test demand. It is a bold bet in a tough market.

China’s hidden debt undermines its sermons

8 Sep 2011

The government’s stated debt is just 15 percent of GDP. But a gaping pension hole and heavy borrowing by state-backed entities could leave Beijing on the hook for debts closer to 130 percent of GDP. That makes China’s preaching over profligate American ways ring a bit hollow.

Stated numbers don’t tell China’s inflation story

8 Sep 2011

Consumer prices rose 6 percent in August, official statistics are likely to say. But like most Chinese data, that’s a guide not a fact. For savers, inflation probably feels higher. Depositors and politicians are worried. Investors cannot afford to be complacent.

Asian bonds offer new-style refuge in market panic

5 Sep 2011

If markets swoon anew, as negative economic signals suggests they might, Asian bonds and CDS both stand to gain ground. In the past, the two have moved in opposite directions. Their altered relationship offers a handy storm shelter for investors while it persists.

China small-stock boom puts big banks in the cold

2 Sep 2011

The likes of CICC and Goldman Sachs have dropped off China’s IPO league tables. A shift to second-tier stock markets favours nimbler and smaller underwriters. With Shenzhen’s boards raising twice what the main Shanghai exchange did this year, the big guys must adjust.

Japan’s LCD bailout puts state in reformist role

1 Sep 2011

Its big manufacturers have long placed job security over profits. So Tokyo has devised a face-saving way for Hitachi, Sony and Toshiba to spin off their ailing LCD units. A state-funded joint venture subsidizes R&D - and the social cost of consolidation that companies fear most.