TRADE WAR
China files WTO challenge
China announced that it yesterday filled a WTO challenge to US President Donald Trump’s proposal for a tariff hike on US$200 billion of Chinese goods, reacting swiftly amid deepening concern about the economic impact of the countries’ spiraling technology dispute. The one-sentence statement by the Chinese Ministry of Commerce gave no legal grounds for the challenge or other details. It is an unusually rapid move for a trade case, coming less than one week after US Trade Representative Robert Lighthizer announced the tariff plan, which would not take effect until at least September. China criticized the move, but has yet to say whether it would retaliate for the second round of tariffs. Its lopsided trade balance with the US means that it has only US$80 billion of annual imports of US goods left for retaliation following its earlier measures.
TELECOMS
MegaFon to delist in London
Billionaire Alisher Usmanov’s MegaFon PJSC plans to spend as much as US$1.26 billion buying back its entire free float and delisting from the London Stock Exchange to take Russia’s second-largest phone carrier private. MegaFon Investment Cyprus Ltd, a unit of the carrier, is to buy up to 129 million shares at US$9.75 apiece by Aug. 22, the company said in a statement yesterday. That is a 21 percent premium to MegaFon’s close in Moscow on Friday. The shares rose as much as 17 percent on the country’s Micex index to 589.9 rubles and gained 7.8 percent in London yesterday. Russian companies have been pulling back from London’s stock market after being hit by falling valuations as investors fret about geographical and corporate governance risks, with sanctions hurting sentiment.
RETAIL
Thai giant mulls listing
Central Group, one of Thailand’s biggest conglomerates, is studying options including a potential initial public offering of retail assets, people with knowledge of the matter said. The group is working on a restructuring of its retail operations ahead of a possible initial listing as soon as next year, the people said, asking not to be identified because the information is private. The listing could include department store businesses owned by Central, one of the people said. Any share sale could raise at least US$1 billion, the people said. A deal that size would be Thailand’s biggest first-time share sale since Jasmine Broadband Internet Infrastructure Fund’s US$1.7 billion listing in 2015, data compiled by Bloomberg show. Central, which is targeting sales of 397.3 billion baht (US$11.94 billion) this year, gets about 40 percent of revenue from its department store group, its Web site showed.
BANKING
DB outperforms forecasts
Germany’s biggest lender Deutsche Bank (DB) yesterday said that it far outstripped analysts’ estimates of its earnings in the second quarter of the year, but its bottom line remained short of last year’s performance. The group said it would report net income of “approximately 400 million euros” (US$468.3 million) between April and June — 10.5 percent lower than in the same period last year. However, the result is much beefier than predictions from analysts surveyed by data company Factset, who forecast net income of about 120 million euros. Meanwhile, Deutsche Bank said that second-quarter revenues would be stable year-on-year at about 6.6 billion euros — higher than analysts’ consensus forecast of about 6.4 billion.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
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