Bloomberg

(Bloomberg) — Alibaba Group Holding Ltd. shares slipped 3.6% in U.S. premarket trading after Citigroup Inc. analysts saw its additional American depositary share registration in the U.S. as a sign that SoftBank Group Corp. may intend to sell part of its stake.

A stake sale by Softbank, a pre-initial public offering investor, would likely weaken sentiment toward Alibaba’s shares, battered last year along with other Chinese technology peers by Beijing’s regulatory crackdowns. The stock was 61% below its October 2020 highs as of Friday’s close, having slid as much as 65%.

SoftBank owns 5.39 billion ordinary Alibaba shares, equivalent to 673.76 million ADSs, or a 24.8% stake, according to Citi’s calculations. A potential stake sale could make sense for Masayoshi Son’s SoftBank, given pressure from investors in recent months as the value of many portfolio companies, including Didi Global Inc., One 97 Communications Ltd. and DoorDash Inc. was dragged lower by the technology downturn.

Alibaba filed a form on Friday with the Securities and Exchange Commission of the U.S. to register an additional one billion ADSs, each representing eight ordinary shares. The filing will allow its stockholders whose shares have never been registered with the regulator to have the flexibility to sell stock, Citi said. The registration could also cover the company’s need to issue new shares for an employee equity incentive plan.

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(Bloomberg) — The Israeli government will form a panel to look into the use of various technologies, the country’s public security minister said following reports of alleged misuse of spyware by the police. 

In a series of reports, Calcalist newspaper website has alleged that the police illicitly used NSO Group’s Pegasus software to monitor multiple people, ranging from critics of former Prime Minister Benjamin Netanyahu to a key prosecution witness in his trial to the former Israeli leader’s son.

Read: Israel Pushes Back on Alleged Illicit Police Use of NSO Spyware

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(Bloomberg) — While Taiwan has occupied a pivotal position in the world’s electronics supply chain, for the longest time no one thought it had a chance of achieving similar success in the auto industry. The perception was that no local company made the crucial components required by internal combustion engine vehicles. 

That changed almost overnight when automakers started to complain about a shortage of semiconductors early last year. In the race to accelerate EVs, car companies now require more electronics components than ever before. That’s underscored by the global push for greener and smarter automobiles and consumers’ Covid-induced preference for private transport. 

Previously best known as the exclusive main processor supplier for Apple devices, Taiwan Semiconductor Manufacturing Co.’s name has begun to pop up in almost all conversations about the Great Chip Dearth. Even though autos account for a low-single-digit percentage of TSMC’s overall sales, the Taiwanese chipmaker’s role in the world’s car supply chain was critical enough to bring senior officials from the U.S., Germany and elsewhere to call upon Taiwan to increase production of the microelectronics powering vehicles and other gadgets to aid in the post-Covid economic recovery. 

The industry’s EV transition has created opportunities for Taiwanese companies beyond TSMC, too. With EVs requiring many more electronics parts, Taiwan’s tech supply chain is seizing this opportunity with both hands. 

Apple’s key assembly partner Foxconn Technology Group has agreed to acquire Lordstown Motors’ Ohio pickup plant, pending regulatory approval, as a key step in its quest to become another Magna. Foxconn, together with Taiwanese peers Pegatron and Quanta Computer, has also been supplying parts to Tesla, while Delta Electronics provides power products or powertrains to GM, Stellantis and other major carmakers.

Still others are choosing to work with tier-one suppliers. PC and server maker Inventec is now supplying motherboards to Bosch and Continental, for example.

The ascension of Taiwan tech was on full display earlier this year at the Consumer Electronics Show in Las Vegas. A partnership between BMW and E Ink, the long-time e-paper supplier to Amazon’s Kindle, resulted in one of the event’s highlights — a concept SUV that can change color.

Local officials here are understandably keen to help more Taiwanese companies pile in. The government in the southern city of Tainan is scouting for suitable land in industrial parks to establish specialized zones for auto-electronics suppliers to build offices and plants. 

“As industries undergo digital transformation, they’ll need new materials, new manufacturing models and support from a comprehensive ICT supply chain,” E Ink President F.Y. Gan told me during an interview earlier this year. “This is exactly where Taiwan’s strength lies.”

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(Bloomberg) — Pakistan’s QisstPay is entering the U.S. by launching its online shopping tool that will be used by retailers, marking its expansion from South Asia to North America.

The buy-now, pay-later startup is expanding to the U.S. and regional markets by introducing its one-click checkout product, said Jordan Olivas, chief executive officer. QisstPay plans to increase its workforce by 200 to reach 350 by the end of the year to support its expansion, he said.

The company is looking to capitalize on a boom in e-commerce that accelerated during the pandemic, which drove shoppers online while many brick-and-mortar stores shuttered temporarily or even permanently in the U.S. Competitor Bolt Financial Inc. raised $355 million to double its valuation to $11 billion this year. 

With the company’s checkout service, customers can make purchases with a single click, without filling out repetitive forms or recalling passwords. There is a higher conversion rate for retailers who offer such a service, said Olivas.

The move comes after U.S. citizen Olivas moved to Pakistan last year to start a buy-now, pay-later platform to emulate success at his former employer, Klarna. Pakistan, one of the world’s largest untapped markets, is seeing a startup funding surge with more than $350 million raised last year, greater than the amount raised in at least the past six years combined.

“The plan will bring hundreds of jobs to Pakistan and the goal is to become one of the first unicorns in Pakistan,” said Olivas by phone.

QisstPay has also opened an office in Bangladesh ahead of launching in the market.

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(Bloomberg) — Bilibili Inc. denied that it overworked an employee who died during the Chinese New Year holiday, reigniting a debate over the culture of prolonged hours that persists within China’s tech companies.

The country’s largest anime-focused streaming site confirmed that a content moderator, who joined in May 2020, died on Friday, according to an internal memo on Monday shared with Bloomberg News. The male staffer was suddenly rushed to the hospital on the afternoon of Feb. 4 from his home and succumbed to a brain hemorrhage later that evening. 

In response to online posts alleging that the man had died of overwork, the company claimed that he didn’t work overtime in the week before his death and that his hours ran between 9:30 a.m. to 6:30 p.m.

The statement followed a growing outcry on Chinese social media over the death, with Bilibili becoming one of the top trending topics on the Twitter-like Weibo. While tech billionaires such as Alibaba Group Holding Ltd. founder Jack Ma have endorsed the culture of “996” working hours — 9 a.m. to 9 p.m., six days a week, with added overtime — as necessary in a competitive industry, there has been growing pushback in recent years and China’s top court issued its most detailed warning last year that the practice is illegal. 

The Bilibili death comes more than a year after a Pinduoduo Inc. worker in her early 20s died, prompting authorities to open a probe into conditions at the e-commerce giant. 

A hashtag alleging that the man had died from overwork was read more than 230 million times on Weibo. Screenshots and posts from individuals who said they worked at the company described 12-hour night shifts that ran from 9 p.m. to 9 a.m. without rest during the Chinese New Year holiday last week.

Job postings on Bilibili’s official website for content moderators, or “auditors,” list requirements including holiday and overnight shifts. As of 2020, the company had hired an army of 2,400 content auditors, or roughly 30% of its total headcount, in cities like Wuhan and Shanghai, according to a filing to the Hong Kong stock exchange.

The video-sharing website has repeatedly run afoul of Beijing’s content regulators, with pressure increasing in recent months as authorities stepped up scrutiny of the industry. In 2018, it was removed from China’s major Android app stores for a month after regulators expressed concerns over inappropriate material, prompting the company to double the number of content-moderation staff and pledge to recruit 36,000 “volunteer” censors.

Chinese Video Site Serves Teens Anime With Side of Nationalism

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(Bloomberg) — Online abuse heaped on China’s U.S.-born figure skater Zhu Yi after she fell during her programs is highlighting the intense nationalism that host-nation athletes must navigate at the Beijing Winter Olympics.

Zhu’s performance during the women’s free-skate team event Monday, in which she fell for a second day, was denounced as a “disgrace” by users of the Twitter-like Weibo platform, who questioned why the 19-year-old was selected over a Chinese-born athlete. The hashtags “Zhu Yi’s consecutive mistakes” and “Zhu Yi tears up again on the ice” saw tens of millions of views on Weibo by Monday afternoon, with some commenting that the games weren’t a platform for practice. 

Censors had stepped in to make the hashtag “Zhu Yi has fallen” unsearchable, after it gained over 200 million views over the weekend when the skater fell twice on her Olympics debut and finished last in the women’s short program team event. China finished fifth overall. 

“There were some mistakes, but it has already passed. I hope I can adjust myself and compete well,” Zhu told state-run China News Service after her competition Monday. “I’ve been very moved and excited. Even during the program, I was moved and wanted to cry. I couldn’t hold it back, so I cried. Of course, there were also regrets.”

The vitriol directed at Zhu stood in contrast to the response to Eileen Gu, the 18-year-old freestyle skier, who like Zhu was born and raised in the U.S. and decided to compete for China. Gu, who models for some of the world’s biggest brands and whose face can be seen all around China in advertisements, is in contention to win three gold medals in the Olympics.

Though she fell in one of her runs on Monday, the hashtag “Eileen Gu’s cute expression after her mistake” was trending after the event.

Nationalistic voices have become louder on Chinese social media in recent years amid President Xi Jinping’s mantra of “national rejuvenation,” and particularly as relations with Western countries sour. Athletes that naturalize to compete for the Chinese team are under even greater scrutiny as the public are more likely to highlight their dual national identities, particularly in moments of under-performance.

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(Bloomberg) — Peloton Interactive Inc. soared in premarket trading after reports that it’s exploring takeover options, a move that could test investors holding short positions in the fitness company. 

The New York-based company is working with an adviser after an earlier plunge in Peloton’s shares made it a takeover target, according to people familiar with the matter, who asked not to be identified because discussions are private. The takeover interest is exploratory and may not lead to a transaction, they said.

The stock rose 27% in early premarket trading in New York and could see more gains at the New York open due to high short interest. A 12% short position on its free float could mean short sellers would scramble to cover their positions, fueling shares further higher.

“You don’t want to be short over a weekend when ‘Merger Monday’ is the day of the week when deals are announced,” said Jim Dixon, senior equity sales trader at Mirabaud Securities. “The rally in Peloton from M&A chatter was fueled a tad more from the outstanding short positions on the indoor exercise bike maker.”

Peloton’s stock has fallen more than 80% from the high a year ago as the gradual easing of pandemic restrictions fueled concern that growth would slow. It’s currently valued at just over $8 billion, based on Friday’s official market close of $24.60 a share — below its September 2019 initial public offering price of $29 a share.

Activist investor Blackwells Capital LLC last month issued a letter demanding the company fire co-founder and Chief Executive Officer John Foley and pursue a sale. Blackwells said in the letter that potential buyers could include Apple Inc., Walt Disney Co., and Nike.

Amazon.com Inc. has been speaking to advisers about a potential deal, the Wall Street Journal reported on Friday. Nike Inc. is also considering a separate bid for Peloton, the Financial Times said. Neither Nike nor Amazon have held direct talks with Peloton, the FT reported. 

Analyst views on the likelihood of a deal are mixed. John Blackledge at Cowan said any deal is unlikely given the company’s potential and vision, and Amazon isn’t an ideal fit as its focus is on mass-market selling while Peloton has a premium positioning. Wedbush’s Dan Ives said a bid from Apple would make strategic sense given the tech giant’s focus on health initiatives. 

(Updates with trader comment in fourth paragraph, analyst comment in last paragraph.)

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(Bloomberg) — Alphabet Inc.’s Google is being sued by Nordic price comparison provider PriceRunner AB for about 22 billion kronor ($2.4 billion) at Stockholm’s patent and market court.

The lawsuit follows the conclusion of a legal ruling in the European Union that established Google has breached antitrust laws by manipulating search results in favor of its own comparison-shopping services, PriceRunner said in an emailed statement Monday.

“This is also a matter of survival for many European entrepreneurial companies and job opportunities within tech,” said Mikael Lindahl, chief executive officer of PriceRunner.

Google spokesperson Emily Clarke told Bloomberg that the company is looking forward to defending its case in court. 

“PriceRunner chose not to use shopping ads on Google, so may not have seen the same successes that others have,” Clarke said in emailed comments.

Stockholm-based PriceRunner, which has agreed to be bought by Klarna Bank AB, expects that the final damages of the lawsuit will be “significantly higher” because the violation is still ongoing, according to the statement.

Last month, the U.S. tech giant said it had filed a challenge against the ruling at the EU Court of Justice “because we feel there are areas that require legal clarification” from the bloc’s top judges. 

(Adds comment from Google from fourth paragraph)

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(Bloomberg) —

British fintech firms attracted $37.3 billion of investment last year, up from $5.2 billion in 2020, bolstered by the completion of London Stock Exchange Group Plc’s purchase of Refinitiv and surging valuations across the industry.

The number of completed deals rose by more than a quarter to 601, according to a report by professional services firm KPMG. The U.K. was home to five of the ten largest fintech deals in Europe, the Middle East and Africa last year. 

Globally, fintech investment rose about 70% to more than $210 billion last year, stoked by interest in crypto and blockchain technology. EMEA saw $77 billion of the total, including $18.5 billion invested in the Nordic region and $5.4 billion in Germany.

The deals boom for payments companies worldwide took their share of investment to $51.7 billion, while a record $30 billion was invested in blockchain and crypto offerings. Cybersecurity firms drew $4.9 billion and wealth products $1.6 billion, according to the report.

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