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Technology Stocks : Softbank Investment International (HK0648)

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To: Yamakita who wrote ()	3/20/2000 12:34:00 PM
From: ghengis2	of 615

Yahoo news update asia.dailynews.yahoo.com Monday, March 20 7:25 PM SGT Cheung Wah Development's Stock Dives on Resumption of Trade [March 20, 2000-HONG KONG] After being suspended for a week on the company's request, Cheung Wah Development's (to be renamed Softbank Investment International (Strategic) - SBIIS) shares resumed trading today. By the end of trading, the counter had declined 22.73% to HK$6.80 against a market gain of 0.89%. What happened to SBIIS? Well, it appears that the market has not taken a positive view of the strategy the company outlined slightly more than a week ago. SBIIS said it would focus on assisting non-Internet companies transform into new economy companies - essentially putting the E into E-commerce for these companies. What does this mean? Through its 'bricks' to 'clicks' strategy it appears that SBIIS has taken a longer-term strategy of moving real offline businesses into real online businesses. The company intends to identify and team up with old economy businesses, forming joint ventures with them to build new economy businesses with real profits. As a concrete step forward in implementing this strategy the company announced on Friday share swap agreements with Chinadotcom, Lai Sun Hotel, PhilWeb and Vincent Tan. Through these partnerships, SBIIS hopes to expand its scope for identifying real world companies with strong potential for profitable online businesses. In the long term, this seems a more viable strategy than merely setting up yet another web portal with vague ideas or me-too plans for generating profits. So, why the negative reaction? Well, it appears the market likes deals and people were hoping that SBIIS would announce a string of acquisitions in the greater China Internet space. That didn't happen and the share price reacted accordingly. The question remains - is SBIIS a good bet for China's nascent Internet industry? Few have to be reminded that Softbank is one of the grand-daddies of the cyberworld having invested in the likes of Yahoo and E-Trade when everyone else was still investing in the old economy. If anyone knows the Internet - it's the people at Softbank. This does not mean they will win all of the Internet rewards in China - but you'd have to be pretty brave to count them out.

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