INVESTMENT
VC firms invested US$84bn
Venture capital (VC) funding in the US has hit its highest level since the dotcom era. US venture firms last year deployed US$84 billion in more than 8,000 companies, research firm PitchBook said. The last time this much money sloshed around Silicon Valley and other tech hubs, many venture firms lost their investments in the dotcom bust of the early 2000s. That is far less likely to happen today. “While the figures are comparable to the dotcom era, the VC ecosystem appears healthy and driven by different dynamics,” PitchBook CEO and founder John Gabbert said in a statement. “Later-stage companies with strong consumer traction are commanding large rounds of financing.” The number of exits fell for the third consecutive year, the report said, the lowest since 2011.
SAUDI ARABIA
Foreign investor cap raised
The government is to lower minimum assets under management for qualified foreign institutions starting this month and allow foreigners to own up to 49 percent of listed securities as it opens up the stock market. The Capital Market Authority raised the limit for a single qualified foreign investor in a company to 10 percent and set the ceiling for foreign holdings in all categories, whether resident or nonresidents, at 49 percent, it said in a statement on Tuesday. In an initial proposal in 2014 that became effective the following year, the regulator had set a 5 percent limit for a qualified foreign investor in a single company. The agency also lowered the level of assets under management or custody investors must have from 3.75 billion riyals to 1.875 billion riyals (US$999.8 million to US$499.9 million). Formal approval of the new requirements, which take effect on Jan. 23, affirms an amended draft proposal from November last year.
AIRLINES
HNA failed to reveal assets
HNA Group Co Ltd (海航集團) said it failed to fully disclose how its US$350 million stake in Virgin Australia Holdings Ltd is controlled, less than a month after regulators in New Zealand blocked an acquisition, citing the Chinese conglomerate’s opaque ownership structure. Five substantial holder notices to the Australian Securities Exchange in 2016 and last year relating to HNA’s 20 percent stake left out entities with “relevant interest” in the airline, the Chinese company said in a letter to Sydney-listed Virgin Australia that was disclosed by the bourse on Monday. HNA’s belated disclosure lists 518 entities from South America to Asia that appear to deal in everything from hotels and refrigerated trucks to aviation and car rentals. The date on the letter, Tuesday last week, is just days after the New Zealand Overseas Investment Office barred HNA’s purchase of a local asset finance firm.
REAL ESTATE
Singapore prices to increase
Credit Suisse Group AG and Morgan Stanley are calling the end of Singapore’s property downturn, after a second consecutive quarterly increase in private residential prices. Home prices might rise as much as 10 percent this year, according to analysts at Credit Suisse, while Morgan Stanley and OCBC Investment Research expect as much as an 8 percent increase, according to reports from the brokerage firms. Private residential prices rose for a second straight quarter in the period ended on Sunday last week, reinforcing signs that the city-state’s property market is emerging from a four-year slump. Prices last year rose 1 percent, compared with a 3.1 percent decline in 2016, Singaporean Urban Redevelopment Authority data showed.
EXTRATERRITORIAL REACH: China extended its legal jurisdiction to ban some dual-use goods of Chinese origin from being sold to the US, even by third countries Beijing has set out to extend its domestic laws across international borders with a ban on selling some goods to the US that applies to companies both inside and outside China. The new export control rules are China’s first attempt to replicate the extraterritorial reach of US and European sanctions by covering Chinese products or goods with Chinese parts in them. In an announcement this week, China declared it is banning the sale of dual-use items to the US military and also the export to the US of materials such as gallium and germanium. Companies and people overseas would be subject to
TECH COMPETITION: The US restricted sales of two dozen types of manufacturing equipment and three software tools, and blacklisted 140 more Chinese entities US President Joe Biden’s administration unveiled new restrictions on China’s access to vital components for chips and artificial intelligence (AI), escalating a campaign to contain Beijing’s technological ambitions. The US Department of Commerce slapped additional curbs on the sale of high-bandwidth memory (HBM) and chipmaking gear, including that produced by US firms at foreign facilities. It also blacklisted 140 more Chinese entities that it accused of acting on Beijing’s behalf, although it did not name them in an initial statement. Full details on the new sanctions and Entity List additions were to be published later yesterday, a US official said. The US “will
TENSE TIMES: Formosa Plastics sees uncertainty surrounding the incoming Trump administration in the US, geopolitical tensions and China’s faltering economy Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday posted overall revenue of NT$118.61 billion (US$3.66 billion) for last month, marking a 7.2 percent rise from October, but a 2.5 percent fall from one year earlier. The group has mixed views about its business outlook for the current quarter and beyond, as uncertainty builds over the US power transition and geopolitical tensions. Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported a monthly uptick of 15.3 percent in its revenue to NT$18.15 billion, as Typhoon Kong-rey postponed partial shipments slated for October and last month, it said. The
COLLABORATION: The operations center shows the close partnership between Taiwan and Japan in the field of semiconductors, Minister of Economic Affairs J.W. Kuo said Tokyo Electron Ltd, Asia’s biggest semiconductor equipment supplier, yesterday launched a NT$2 billion (US$61.5 million) operations center in Tainan as it aims to expand capacity and meet growing demand. Its new Taiwan Operations Center is expected to help customers release their products faster, boost production efficiency and shorten equipment repair time in a cost-effective way, the company said. The center is about a five-minute drive from the factories of its major customers such as Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) advanced 3-nanometer and 2-nanometer fabs. The operations center would have about 1,000 employees when it is fully utilized, the company
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