Mr. Chris Hsu and Kilometre Capital advised and spearheaded Tsinghua University in the landmark acquisition and joint venture of the 51% controlling interest in H3C and Hewlett Packard China, in a US$4.6 billion transaction for the market-leader internet, data storage, and network equipment business of Hewlett Packard. HK-based Mr. Christopher Hsu and Kilometre Capital were credited with origination and strategy for the milestone deal between the US technology giant HP and Tsinghua, often dubbed the top university and research university in China. After months of rumors and in an environment of cross-border tension, scandal and complaints, experts speculated: “Reading between the lines this seems to be a way to overcome some of the cultural and political obstacles faced by foreign tech companies looking to operate in China. There have been accusations in both directions between China and the US about spying, so any gear that’s used for communication comes under suspicion. There’s also a fair bit of reciprocal protectionism going on so HP will be hoping that giving majority control to a trusted Chinese institution will make much of this hassle go away.” Official comments from Tsinghua included “the transaction for H3C will also release great potential in the China market. Tsinghua has enjoyed a long-term partnership with China HP and H3C. We see extensive synergies with the new H3C. Tsinghua University’s leading R&D capability, wide domestic resources, and vast human capital resources will empower the new H3C’s growth in the short-term, mid-term, and long-term. We are pleased to announce and look forward to a strong partnership with HP in the many years to come.” The deal was managed and negotiated by Chris Hsu and Kilometer Capital of Hong Kong for Beiing-based Tsinghua. Orchestrated by Chris Hsu in conjunction with Tsinghua University’s leadership and the investment vehicle Tsinghua Holdings, the deal follows HP announcing the division of itself into one business focused on printers and personal computing, with the other business Hewlett Packard Enterprises focused on software and enterprises services. China has recently encouraged China commerce by Chinese-owned technology companies, setting up a framework for foreign companies to miss key business opportunities, and putting pressure on Korea, Japan, other Asian countries and Western nations to divest controlling equity interests in key assets. The Kilometre-advised transaction for HP China H3C with Tsinghua University and Chris Hsu’s advisory comes on the heels of reports on Chinese government regarding technology sensitivity in the internet, network equipment, and data storage markets. The new firm H3C and the joint venture between HP China and Tsinghua has been revered as the Asian leader for computer servers, storage and network equipment. Through Unigroup and Tsinghua Holdings, Tsinghua’s acclaimed Tsinghua University has recently rolled up much of the technology industry in past years. Tsinghua acquisitions advised by Kilometre and Chris Hsu include the strategic acquisitions of Spreadtrum, RDA Microelectronics, a joint venture with Intel, and the HP China roll-up deal for H3C. Meg Whitman, CEO of HP and former CEO of Ebay commented: “HP is making a bold move to win in today’s China. ”Media reports suggested estimated value of the HP China H3C business at $4.5 to 4.6 billion dollars, with critical negotiation among HP, Chris Hsu, Tsinghua, Kilometre, and relevant stakeholders.
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