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China probes U.S. firms

Friday, September 02, 2016 - 01:40

The Chinese government is investigating Didi - Uber and Comcast - DreamWorks deals. Bobbi Rebell reports.

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The Chinese government is investigating two high-profile takeovers involving U.S. companies with ties to China. The first involves Chinese ride-hailing giant Didi's plans to buy U.S. rival Uber's China unit. The two largest ride sharing services together control around ninety percent of the market, and there is concern about rising prices for consumers. The second, involving Comcast's purchase of movie studio DreamWorks Animation, is already a done deal. The ministry cited unspecified complains the deal would hurt competition. DreamWorks was one of the first Hollywood names to open a production studio in China. But lawyers have expressed surprise the deal would be scrutinized given DreamWorks relatively small footprint in China. At the heart of the matter: China flexing its muscles when it comes to doing business in the country. Savio Chan runs U.S. China Partners. (SOUNDBITE) SAVIO CHAN, CEO, U.S. CHINA PARTNERS, (ENGLISH) SAYING: "China simply wants the world to know that, if you plan to do any development work M&A, green filed development, you know, whatever you want to do in China that impacts or influences Chinese consumers, the 1.4 billion of them, you make sure you notify the parent." China's ministry of commerce requires companies to notify it of transactions before they close, especially if those merging have combined global turnover in the previous year exceeding ten billion yuan or $1.5 billion, or their combined China income exceeds two billion yuan. Didi said its proposed deal with Uber does not trigger those thresholds.

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China probes U.S. firms

Friday, September 02, 2016 - 01:40