A week in tech, June 16 - 22

China

Internet
• Tom Online disclosed that it will acquire Infomax, a wireless entertainment company, in a deal valued up to $75 million. Tom Online said in a statement that the acquisition would give the company access to hundreds of millions of Chinese households via Infomax's television network, strengthening its presence in the country's wireless Internet market. The acquisition is expected to provide opportunities for product diversification, operational efficiencies and content sharing. Under the acquisition, TOM Online said it would acquire 100 percent of Infomax with the maximum valuation placed at Rmb600 million ($75 million).

Mobile/Wireless
• eBay’s China-based subsidiary, eBay Eachnet, announced its launching of a WAP-based mobile shopping platform in cooperation with Tom Online. Under the agreement, Tom Online said it will provide wireless technology for eBay Eachnet to allow users to do their shopping through WAP-enabled mobile phones. Aside from Tom Online, eBay Eachnet said it will also seek more partners in wireless value-added operators. eBay Eachnet is lagging behind local frontrunner Taobao.com, a unit of Alibaba.com, the premier business-to-business site in China. According to Chinese market research firm Analysys International, Tabao.com had a 57.7 percent market share compared with eBay Eachnet’s 31.5 percent in 2005.

Software
• SAP revealed that it paid more than $12.6 million for a minority stake in Neusoft, one of China's leading IT services and training firms with more than 8,000 staff and sales of Rmb2.8 billion ($350 million) last year. A top company official said China's demand for business management software - including enterprise resource planning, customer relationship management and supply-chain management applications - would continue to grow over the next few years with much of it driven by SMEs. The Neusoft deal and other local partner investments are expected to help SAP reach more potential customers through known market specialists. SAP has about 30 local partners on the mainland. Analysts estimate the mainland ERP market to be worth about $200 million, with aggressive local players such as Kingdee International Software Group and Ufida dominating the SME segment. SAP has prospered by focusing on large domestic enterprises and other multinationals. With a compound annual growth rate of 70 per cent over the past nine years, SAP is one of the most profitable foreign companies in China.

Hardware
• TC Interconnect, one of the leading manufacturers of printed circuit boards in China (PCB), announced its plans to raise up to HK$60 million ($7.7 million) in its Hong Kong IPO this month. Without divulging details, the company said it has received positive reception to the institutional portion of its offering with a prominent strategic investor already on board. Kingboard Chemical, one of the world’s largest makers of laminated and printed circuit boards will be holding a 9.9 percent interest in the company with a lock-up period of six months after the listing. The company has one production plant in Guangdong province with an annual production rate of about 36.6 million sq ft worth of PCBs. It plans to construct a new plant in the same province in August this year, with the aim of completing it before the end of the year. The company reported for the year ended Dec. 31, 2005 profit of HK$37.2 million ($4.7 million) on the back of revenue of HK$495.6 million ($63.8 million). CAF Securities is sponsoring the listing.

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