Tech stocks snippets : In a radio interview, Richard Li commented that its internet venture capital CyberWorksVentures had invested in 28 high tech companies in the past six months, with value of its investments already surged by some US$1.3bn. He also revealed that Pacific Century Cyberwork (1186) is considering to acquire a minority stake of less than 10% in TOM.COM, the web site set up by Cheung Kong (1) and Hutchison (13). On the other hand, ADR price of CWHKT (8) surged to an equivalent price of HK$21 last night on news that parent company C&W is set to announce the acquisition of several ISPs in Europe. Recent rumor of Apple Daily web site seeking to list in NASDAQ could spark further short term buying in Oriental Press (18). Most investors have overlooked the fact this company owns its popular newspaper web business.
To qualify for a GEM listing in Hong Kong, companies must have at least 2 years operating history. The possible injection of Metro Radio, which has more than 8 years of operating history, can aid Tom.com to satisfy this listing requirement. We expect a major breakthrough in the entertainment & broadcasting media in the future. The acquisition of Warner by AOL is a symbolic move that signals the migration of traditional entertainment on TV or in cinema to the internet. The same will happen in the communication and broadcast media. The two media (entertainment and broadcasting), that are now operating separately, can gain synergy effect after joining their businesses on the internet According to Pacific Century CyberWorks (1186) chairman, Richard Li, the company has gained a paper profit of US$1.3bn from the 28 Internet and information-technology investments made during the past six months. One of the most profitable investments was the purchase last September of a 3.4% stake in CMGI, which based on Tuesday's closing price, showed a paper profit of US$205mn.
About one-third of PCCW's investments have already gone public, and the company will gradually spin-off the rest.
PCCW will take less than 10% of Tom.com, the infotainment Web site which is 20%-owned by Cheung Kong and 40% by Hutchison and to be soft launched next week.
Investors are likely to remain positive on the outlook of PCCW given that it is expected to emerge as one of the major Internet plays in the region. Although we do not expect the company to generate earnings in the medium term, continuous acquisitions and spin-offs will continue to generate interest in the company.
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