Thursday, February 24, 2005

Sina devices poison pill

Traditionally the Chinese way of doing business has involved lot of background checking, before any actions have been made. One had to check up if all the interest groups are ok with the plans. Seems like the culture of making business has changed in China. I personally thought that if Shanda is making such a purchase, they must have, on some level, negotiated with Sina and reached to some sort of an agreement. Sina’s initial comments promised good and the road for acquisition seemed to be open.

What happened? Sine told about poison pill, which makes acquisition of Sina very expensive. Suddenly we have a stalemate in our hands. Shanda doesn’t have the money to buy Sina with these new terms in mind and Sina is not able to develop its business as long as there is a threat hovering over. This makes following Chinese markets even more exciting than European and American.

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