Aug 03, 2020 08:15 PM

China Business Digest: Trump Allows Time for Microsoft or Others to Buy TikTok in U.S.; Two Luckin Affiliates Fined by CSRC



Microsoft signed a notice of intent with ByteDance regarding the purchase of TikTok’s U.S. operations, vowing to complete negotiations by Sept. 15, a deadline U.S. President Donald Trump set while delaying a ban on the video sharing app. Meanwhile, ByteDance founder and CEO Zhang Yiming said he’s not giving up on making the company a global player. China’s regulator punished two companies affiliated with Luckin Coffee.

 By Guo Yingzhe (


Microsoft confirms discussion on TikTok purchase, signs notice of intent with ByteDance

Microsoft Corp. has signed a notice of intent with ByteDance Ltd. as a preliminary step for the company to acquire TikTok in the U.S., two sources familiar with the matter told Caixin (link in Chinese).

U.S. President Donald Trump said Monday he will wait until next month to take action on TikTok, allowing time for Microsoft or some other company to purchase the video sharing app. “I set a date of around Sept. 15, at which point it’s going to be out of business,” unless ByteDance surrenders Chinese ownership, Trump told reporters Monday at the White House.

On Sunday, Microsoft confirmed that it is in talks with ByteDance about purchasing the American operations of the popular short video app, saying that it will complete the discussions no later than Sept. 15.

ByteDance founder says not giving up building a global company

ByteDance founder and CEO Zhang Yiming said on Monday that the plan to build the company into a global player will continue. In an email to staff, he also said that he disagrees with the decision by the Committee on Foreign Investment in the United States (CFIUS) that TikTok’s U.S. operations must be sold.

Caixin China Manufacturing PMI picks up in July

Manufacturing activity in China continued to recover from the fallout of the Covid-19 pandemic in July as businesses reported the fastest expansion of output and new orders since January 2011. The Caixin China General Manufacturing Purchasing Managers’ Index (PMI) rose to 52.8 from 51.2 in June. (Read the full story.)


China says core parts of its satellite system are ‘100% made in China’

China said Monday that the core components of its Beidou satellite navigation system have achieved “100% made in China,” and the 28-nanometre chips that enable mobile devices to receive signals from the satellite are in mass production.

Two Luckin Coffee affiliates fined by CSRC for disclosure violation

Two companies controlled by the founder of scandal-plagued Luckin Coffee Inc. were fined by China’s securities regulator for disclosure violations. Limousine services company Ucar Inc. was fined 500,000 yuan ($71,600) because it failed to consolidate the results of a business it acquired in its financial reports. Qwom Digital Technology Co. Ltd., a marketing company that provides advertisement services to Luckin, was fined 300,000 yuan for failure to disclose related-party transactions with Luckin.

Alibaba boosts investment in EV maker Xpeng before New York IPO

Chinese electric-car startup Xpeng Motors is raising $300 million from Alibaba Group Holding Ltd. and other investors ahead of its planned initial public offering in New York, Bloomberg reported, citing people familiar with the matter. That expands Xpeng’s pre-IPO funding round announced last month to $800 million.

Washington rejects Chinese airlines’ application to increase flights to U.S.

The United States has turned down a request by China-based airlines to increase the number of flights between the two countries on the grounds that Beijing refuses to allow American flights to the capital, Caixin has learned.

Ant Group aims to raise $30 billion in record-shattering IPO

Ant Group, the Chinese fintech giant affiliated with Alibaba Group Holding Ltd., is looking to raise around $30 billion in its highly anticipated concurrent IPO in Hong Kong and Shanghai. (Read the full story.)

How Ant grew into an elephant-sized behemoth

It was a long wait for investors before Ant Group announced its plan last month to go public. With a valuation of roughly $200 billion, the company behind payment provider Alipay is the world’s most valuable tech startup. (Read the cover story.)

Digest Stock Chart 0803


Economy & Finance

• The scale of corporate bond defaults on the Chinese mainland was less severe in the first half of 2020 than in the second half of 2019, despite the grim economy. Still, that might change in the second half, an analyst at Fitch Ratings Inc. said. (Read the full story.)

• Alibaba has agreed to buy HK$828.1 million ($118.5 million) worth of shares in Hong Kong-listed E-House (China) Enterprise Holdings Ltd., as the e-commerce giant expands its presence in real estate. (Read the full story)

• Zhu Kemin, former chairman of Donghai Securities Co. Ltd., has been put under investigation by Communist Party disciplinary officials, the anti-graft watchdog in East China’s Jiangsu province said Friday. (Read the full story.)

•In a recently published speech (link in Chinese), former Chinese central bank chief Zhou Xiaochuan called for tighter oversight of large corporations and financial institutions as flaws in the corporate governance of some have exacerbated risks in the financial system.

• Failure of corporate governance and the resulting misconduct and corruption is behind the risks faced by many small and midsize banks, said Zhou Xuedong (link in Chinese), head of the takeover team for Baoshang Bank Co. Ltd.

Business & Tech

• Chinese contract chipmaker Semiconductor Manufacturing International Corp. (SMIC) has unveiled plans to establish a joint venture to develop a new wafer plant in Beijing, as the company tries to increase output and reduce costs.

• The companies that assemble smartphones for the likes of Samsung Electronics Co. and Apple Inc., including Foxconn Technology Group, Wistron Corp. and Pegatron Corp., are among 22 companies that have pledged investment of 110 billion rupees ($1.5 billion) to set up mobile phone manufacturing units in India. (Bloomberg)

Huawei Technologies Co. Ltd. has taken the crown in quarterly smartphone shipments for the first time by capitalizing on its home-field advantage in China, even as it steadily loses ground overseas. (Nikkei Asian Review)

• China installed 6.32 gigawatts of new wind power capacity (link in Chinese) in the first half of this year, down 30% from the same period in 2019.


• The Chinese mainland added (link in Chinese) 43 new Covid-19 infections on Sunday. Of the new cases, 36 were locally transmitted, with 28 from the Xinjiang Uygur autonomous region and eight from Northeast China’s Liaoning province.

•Hong Kong authorities have converted one of the city’s largest performance venues into a 500-bed makeshift hospital to help with the city’s new Covid-19 outbreak. Hong Kong reported 115 new coronavirus infections on Sunday, taking its total number of confirmed cases to 3,511.

• As of Monday afternoon Beijing time, the number of global coronavirus infections had surpassed 18 million, with the death toll exceeding 689,000, according to data from Johns Hopkins University.

 Read more 
Caixin’s coverage of the new coronavirus


Tourists on Saturday enjoy the splendor of the Hukou waterfall on the Yellow River in Linfen, North China’s Shanxi province, as heavy rainfall in the river’s upper reaches has sent more water over the falls.



Aug. 5: Release of Caixin China services PMI

Aug. 6: SMIC reports second-quarter financial results

Aug. 7: Release of China’s import and export data for July


Contact reporter Guo Yingzhe ( and editors Marcus Ryder ( and Michael Bellart (

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China Business Digest: Regulators to Punish Luckin Coffee; Central Bank Delays New Asset Management Rules

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