China's Number 2 Online Retailer JD.com Files For U.S. IPO

China’s second-largest online retailer JD.com filed for an initial public offering of its shares in the United States. Formerly known as 360Buy, JD.com has raised $2.23 billion in the past six years, with notable investors including the Ontario Teachers’ Pension Plan and Saudi Arabia’s billionaire Prince Alwaleed bin Talal’s Kingdom Holding Co. Company founder and CEO Richard Liu controls about 46 percent of the company’s shares. In 2012, local media reports put a $7.3 billion for the company, which has tried to differentiate itself from rival ecommerce companies, including market leader Alibaba, by operating its own network of delivery providers and warehouses.

"Alibaba rival JD.com files for U.S. listing", Reuters, January 30, 2014

Alibaba Reports Strong Net Profit Gain, Slower Revenue Growth In 3Q

Chinese ecommerce company Alibaba Group Holdings Ltd. reported net profit of $792 in the third quarter. Revenue increased 51 percent to $1.78 billion, significantly slower than the 61 percent growth reported in the previous quarter. For the third quarter of the previous year, Alibaba reported a net loss of $246 million, due to the $550 million charge to purchase some of its shares from Yahoo Inc., which currently owns 24% of the Chinese online company. Alibaba, whose coming IPO is expected to value the company at more than $100 billion, outpaced its competitors Tencent Holdings Ltd., which grew 34 percent; and Amazon.com Inc., which reported revenue grew 24 percent.

"Alibaba Swings to a Profit but Revenue Growth Slows", Wall Street Journal, January 29, 2014

Avon Faces $132 Million Bill To Settle U.S. Bribery Invetigation

Cosmetics company Avon Products said it may have to pay up to $132 million to settle a bribery investigation by the U.S. government into its overseas expansion. In 2011, the U.S. Securities and Exchange Commission and the U.S. Department of Justice began a probe into allegations of improper payments in China. Conducted under U.S. law as defined by the country’s Foreign Corrupt Practices Act, the investigation has caused Avon at least $300 million so far. Avon reported sales declined 10 percent to $2.7 billion while operating losses rose to $17 million, driven by weaker sales in North America and in emerging markets including Mexico, Russia, and China.

"Avon Products may face £80m bill to settle bribery investigation", The Guardian, February 13, 2014

JD.com's IPO Prospectus Comes With Too Much Candor

Chinese online retailer JD.com filed the prospectus for its planned $1.5 billion U.S. public offering with the Securities and Exchange Commission. Apparently, the paperwork came with too much honesty, according to some observers. It detailed the company’s lack of experience in doing some of its businesses, such as Internet finance. It highlighted losses suffered by the company and warned potential investors it might not be able to make money. Also, the company admitted it is huddled by weak internal fraud controls and its financial reports may not be accurate. Its very strong sales growth, however, is expected to attract US investors. That is, if the company could overcome potential legal roadblocks and could actually get its shares listed in the country.

"This Chinese online retailer’s IPO documents could be a bit too candid", Quartz.com, February 04, 2014