Source: Broker China
Today, there was big news in the chip field. The US Department of Commerce's restrictive attitude on the sale of artificial intelligence (AI) chips in China suddenly changed. On December 11, local time, US Secretary of Commerce Gina Raimondo said in an interview with the media that Nvidia “can, will, and should sell AI chips to China because most AI chips will be used for commercial purposes,” but the sale of the most precise AI chips with the highest processing capacity is prohibited.
In response to this, at the Ministry of Foreign Affairs's regular press conference today, Foreign Ministry Spokesman Mao Ning responded that China has stated its position on the US chip export control to China many times. We believe that the misuse of export control measures by the US side seriously harms the legitimate rights and interests of Chinese enterprises, is not conducive to the stability of the global chip production supply chain, violates the market economy and the principle of fair competition, and is not in the interests of any party. China firmly opposes this.
“The US side has stated many times that it has no intention of 'decoupling' from China or blocking the development of the Chinese economy. The US side should implement these promises. The Chinese side will also continue to pay close attention to relevant developments and resolutely protect its own legitimate rights and interests.” Mao Ning said.
Also, at a critical moment, Wang Jianlin's crisis was resolved. On December 12, according to Wanda Group's official website, Taimeng Investment Group (PAG) and Dalian Wanda Business Management Group jointly announced the signing of a new investment agreement. Taimeng will join forces with other investors to reinvest in Zhuhai Wanda Commercial Management after redemption by Dalian Wanda Business Management Group when its investment redemption period expires in 2021. At a critical time when the “limit” of gambling is approaching, this new investment agreement has solved Wanda's “urgent needs.”
The latest US statement
On December 12, according to reference sources quoting Taiwan's “Economic Daily” website on December 12, US Secretary of Commerce Raymondo said that the US government is discussing with Nvidia the issue of allowing the sale of AI chips to China, but stressed that Nvidia cannot sell the most advanced chips to Chinese companies. She also said that the US side is carefully studying the details of the three AI chips Nvidia is developing for China.
According to reports, in an interview with Reuters on the 11th, Raimondo said, “Nvidia can, will, and should sell AI chips to China because most AI chips will be used in commercial applications. We cannot allow Nvidia to export the most complex and processing capable AI chips.”
Raimondo said that in a conversation with Nvidia CEO Hwang In-hoon a week ago, Hwang In-hoon stated, “We don't want to break the rules. Tell us the rules and we will cooperate”. Raimondo also said that the US Department of Commerce is cooperating with Nvidia, “Nvidia wants to act right. Of course, Nvidia wants to sell as many chips as possible”.
According to the report, in an interview with Bloomberg on the 11th, Raimondo said, “We will check every indicator of every new chip to ensure that it does not violate export controls.”
According to reports, Hwang In-hoon said earlier that Nvidia is working closely with the US government to ensure that new chips for the Chinese market meet export restrictions. Huang Renxun said that the Chinese market accounts for about 20% of Nvidia's sales, and the company will continue to “perfectly” comply with trade regulations and provide the Chinese market with a set of new products that meet the latest US government regulations. He added that Nvidia needs to seek advice from the market and this process is ongoing.
According to Hwang In-hoon, Nvidia's dominant position in the AI chip market is facing serious challenges from Huawei, Intel, and a growing number of semiconductor startups.
At Nvidia's 2024 fiscal quarter results briefing, the company's chief financial officer Colette Kress said that due to the tightening of AI regulations in the US, Nvidia's data center revenue from China and other affected regions will drop sharply in the fourth quarter. At the same time, the company is working to expand data center product components that are not affected by the new regulations.
Wanda official announcement
On December 12, according to Wanda Group's official website, Taimeng Investment Group and Dalian Wanda Business Management Group jointly announced the signing of a new investment agreement. Taimeng will join forces with other investors to reinvest in Zhuhai Wanda Commercial Management after redemption by Dalian Wanda Business Management Group when its investment redemption period expires in 2021.
According to reports, current investors invested about 38 billion yuan in Zhuhai Wanda Commercial Management in August 2021, of which the investment amount of Taimeng is about 2.8 billion US dollars (about 18 billion yuan). The current investors enjoy redemption rights at maturity in the original investment arrangement.
According to the new agreement, Dalian Wanda Commercial Management holds 40% of the shares in Zhuhai Wanda Commercial Management. As the single largest shareholder, Taimeng and several other existing and new investors participated in the investment, and held a total of 60% of the shares.
Wanda said that the signing of the new investment agreement shows that investors recognize the leading position of Zhuhai Wanda Business Management in the industry and their confidence in its future growth. Wanda will work with Taimeng and other important shareholders to further optimize the company's corporate governance, maintain a stable management team, and jointly support the company's long-term development.
According to reports, Taimeng Investment Group (PAG) is a private equity investment company focusing on Asia. Its business segments include private equity, real estate, and credit and market investments. Taimeng Investment Group has more than 300 investment professionals distributed in 15 offices around the world, managing more than 55 billion US dollars of assets for nearly 300 institutional fund investors around the world.
Previously, Wanda Business Management signed gambling agreements with various institutional investors such as Country Garden, Ant, and Tencent, and raised 38 billion yuan in capital at a pre-IPO price of 25 yuan per share. Zhuhai Wanda Business Management will complete the listing by the end of 2023 at the latest. Otherwise, Wanda will not only have to pay 38 billion yuan of equity repurchase money to these investors, but will also pay 12% interest.
Zhuhai Wanda Commercial Management has submitted statements to the Hong Kong Stock Exchange four times, but due to the weak environment in the Hong Kong stock market, the listing of Zhuhai Wanda Business Management has been delayed over and over again. As the “limit” for gambling approaches, this new investment agreement can be described as solving Wanda's “urgent needs.”
According to Wanda's disclosure, Zhuhai Wanda Business Management currently manages 494 large commercial centers in 227 prefecture-level cities and above across the country. In the past two years, the number of commercial centers managed by Wanda Business Management in Zhuhai has grown from 417 to 494, with an average annual growth rate of around 9%.
In terms of business area managed, Zhuhai Wanda Commercial Management is currently the world's largest commercial management company. Since current investors invested in 2021, Zhuhai Wanda Business Management has exceeded its performance targets for three consecutive years. Revenue after tax in 2021 was 23.5 billion yuan, 2022 was 27.1 billion yuan, and 2023 (estimated) was 29.3 billion yuan, with an average annual increase of about 12%. Profit after tax in 2021 is 5.3 billion yuan, 2022 is 7.5 billion yuan, and 2023 (estimated) is 9.5 billion yuan, with an annual growth rate of 34%. Over the past three years, the company has paid a total of about 10 billion yuan in taxes, and the dividends to shareholders are 4.6 billion yuan in 2021, 6.7 billion yuan in 2022, and 8.5 billion yuan in 2023 (estimated).
Editor/Jeffrey