BEIJING: Chinese shares climbed to more than three-month highs on Wednesday, and Hong Kong’s benchmark rose after data showed surprising growth in industrial production in May, and as investors expect more policy support to fuel a growth rebound.
At the close, the Shanghai Composite index was up 0.5 percent at 3,305.41, after touching its highest level since March 8 earlier in the session.
The blue-chip CSI300 index, which also touched its highest point since March 8, finished 1.32 percent higher.
Baidu in talks to sell stakes in iQIYI
China’s internet search engine giant Baidu Inc. is in talks to sell its controlling stake in iQIYI Inc., China’s answer to Netflix, in a deal that could value all of iQIYI at about $7 billion, two people with knowledge of the matter said.
Baidu, which owns 53 percent of iQIYI and holds more than 90 percent of its shareholder voting rights, plans to sell all its holdings in the Chinese video-streaming services firm, the two people and another two sources familiar with the matter said.
While cinemas have struggled with COVID-19 lockdowns, China’s online video market is booming. Domestic consulting firm Zhiyan forecasts 2022 revenue is set to climb to 163 billion yuan ($24 billion), up 17 percent year-on-year.
Nasdaq-listed iQIYI, the No. 2 player in China’s video-streaming market after Tencent Holdings’ Tencent Video, has a market value of $4 billion. Baidu’s targeted valuation of $7 billion for the whole company in its divestment would represent a price of about $8.13 per share compared with its latest close of $4.67.
The divestment plan, not previously disclosed by Baidu, comes after the firm deemed iQIYI to be a non-core asset, and as it seeks to sharpen its focus on developing its capital-intensive artificial intelligence and autonomous driving units, the first two sources said.
(With input from Reuters)
