ad info

TIME Asia Home
Current Issue
Magazine Archive
Asia Buzz
Travel Watch
Web Features
  Photo Essays

Subscribe to TIME
Customer Services
About Us
Write to TIME Asia
TIME Canada
TIME Europe
TIME Pacific
TIME Digital
Latest CNN News

Young China
Olympics 2000
On The Road

  east asia
  southeast asia
  south asia
  central asia

Other News
From TIME Asia

Culture on Demand: Black is Beautiful
The American Express black card is the ultimate status symbol

Asia Buzz: Should the Net Be Free?
Web heads want it all -- for nothing

JAPAN: Failed Revolution
Prime Minister Yoshiro Mori clings to power as dissidents in his party finally decide not to back a no-confidence motion

Cover: Endgame?
After Florida's controversial ballot recount, Bush holds a 537-vote lead in the state, which could give him the election

TIME Digest

TIME Asia Services
Subscribe to TIME! Get up to 3 MONTHS FREE!

Bookmark TIME
TIME Media Kit
Recent awards

TIME AsiaAsiaweekAsia Now TIME Asia story

MARCH 6, 2000 VOL. 155 NO. 9

The Name of the Game
Hong Kong investors flock to a dotcom firm with no track record. Why? Three words: Li Ka-shing

Who wants to be a millionaire? Most people wouldn't mind. But who wants to hand over their savings to a millionaire? That was the question in Hong Kong last week, and the answer: just about everybody. Hundreds of thousands of people jostled, shoved and sometimes begged to give sizable checks to Li Ka-shing, Hong Kong's most powerful tycoon. Some 50,000 lined up in one neighborhood, and 100 policemen had to be dispatched to keep them peaceful. On Nathan Road, Hong Kong's prime tourist boulevard, traffic had to be rerouted to accommodate crowds waving bank drafts.

Technically, they weren't giving Li cash but investing it in a company--even sexier, an Internet company with the catchy name of associated with him. That sounds reasonable, although financial experts noted the locals' propensity for mass hysteria over money matters. None was more distressed than Donald Tsang, the Financial Secretary, who worried about people overseas seeing television footage of Hong Kongers going bananas: "Wouldn't they think money is all the society is about?"

What the hordes were clamoring for was a piece of a new Internet venture, 57% of which is owned by Hutchison-Whampoa and its parent Cheung Kong Holdings, the flagship of Li's business empire. (Another significant shareholder is Pacific Century CyberWorks, a high-flying Internet company controlled by Li's son Richard, who is currently trying to gain control of Cable & Wireless HKT, the Hong Kong telecom giant.) Li offered 16.9% of's shares to the public to raise $113 million. And in contrast to a stock offering in the United States, where hot ipos are usually the domain of big mutual funds and other institutional investors, a full 10% of those shares were allocated to individual investors.

Taiwan: Off With a Bang
Fiery words from Beijing mark the start of the island's critical presidential election, but the three leading contenders continue to focus mostly on local concerns
On the Issues: The candidates share their views
Tough Talk: Beijing too has a domestic agenda
Jiang Who? Taiwan's youth couldn't care less about China
Line of Fire: Sin-ming Shaw says the posturing must stop

Hong Kong: Feeding Frenzy
Local investors go nuts for a dotcom stock that has little to recommend it other than its billionaire backer's name

Thailand: Dubious Challenge A telecom tycoon and failed pol makes another bid for office
Web-only Interview: Thai telecoms mogul Thaksin Shinawatra, the man who would be Prime Minister

Japan: Invisible Menace The growing problem of stalking is only now coming to light

China: Back to School The white-hot economy needs an increasing number of M.B.A.s

Cover: China Dot Now
The world's last big communist state is hit by a wave of Web mania, and the bureaucrats are fighting to contain it
B2B: Joseph Tong casts a Web over Chinese exporters
Chortling: Wang Zhidong should have laughed last
Crazy Man: Jack Ma goes for the shrimp, not the whales
Princeling: Antony Yip finds the right sites
Geek Chic: Shao Yibo grows up fast
Regulation: How Beijing plans to control the Net

Like Father, Like Son
Tyro tycoon Richard Li goes after the phone company

Breaking news from East Asia
When did its sums, investors had given checks for 700 times the number of shares available. So much cash was locked up in the offer that trading in other shares slumped, prompting concerns over the stability of the financial system as a whole. The good news for those who bought shares at the offer price of 23 cents: analysts expect shares to at least quadruple when trading begins this week, and that's a spectacular paper profit.

Despite the frenzy on the streets, wasn't as popular as some of the "red-chip" companies, so called for their connections to the Chinese mainland, that were floated in Hong Kong in the mid-'90s. (The wheels on that bandwagon fell off a few years later when several of the firms defaulted on their debts.) But is the most successful launch anywhere for a company that essentially does nothing. Cheung Kong is a property conglomerate with virtually no Internet experience. was created in November, and the domain name was bought from a U.S. company in December. does have a website, which broadcasts programming from a Hong Kong radio station. Other than that, it has little but the glitter of Li's backing and a business plan that would have been considered audacious to the point of lunacy just a few months ago. Its managers say they want to become the most popular portal, or entry site, for Chinese-language Internet users, after which they intend to make it "the Time Warner of Asia." But they also admit that plans for the company really begin with the public offering, which was designed to give "currency," they say, to use in making Internet-related investments and poaching Net-savvy people.

Currency it got, from the nest eggs of some half-million individuals, and the $113 million raised last week is a big chunk of's working capital. In other words, now that the public has ponied up some cash, will figure out how to spend it. "You can say that it's nothing now," says Scott Blanchard, head of Asian Sales Trading at ABN AMRO. "But give it a little time. Li is waiting until he has a market capitalization before he starts making big deals and signing on big names. Success is a self-fulfilling prophecy for"

Individual investors weren't the only ones mesmerized by the Li connection. The Stock Exchange of Hong Kong granted Cheung Kong a rare waiver of its rule that investments in a new issue must be held for at least two years; instead, Cheung Kong is free to cash out after only six months. Perhaps stung by accusations of favoritism, the Exchange ordered an investigation into the chaos that surrounded last week's offering.

"I think it's all a dead-on sign we're reaching the peak of the market," says Sadiq Currimbhoy, a strategist at Merrill Lynch's Hong Kong office, where the office boy was among the throngs trying to buy shares. Other indications: the Hang Seng Index has climbed 70% in the past 12 months, and many of the most popular tech stocks aren't even represented on the index. In January, shares in a money-losing textile company called Cheung Wah rocketed 32-fold after Japanese Internet investor Softbank announced plans to acquire it for use as a holding company. Acme Landis, which manufactures and installs toilet bowls and sinks, has become a hot stock after a consortium of Netrepreneurs and investors bought a majority stake in the company. And last week, Hong Kong businessman Simon Murray acquired a local company called Arnhold Holdings, which used to make kitchen cabinets. He's turning it into a tech stock, and the shares finished the week up nearly 400%. Murray's claim to fame: as a former chief executive officer of Hutchison-Whampoa, he is known to enjoy Li's good graces. In today's Hong Kong, that's enough to get the checkbooks fluttering.

Reported by Eric Ellis/Singapore and Maureen Tkacik/Hong Kong

Write to TIME at

This edition's table of contents
TIME Asia home


Quick Scroll: More stories from TIME, Asiaweek and CNN


U.S. secretary of state says China should be 'tolerant'

Philippine government denies Estrada's claim to presidency

Faith, madness, magic mix at sacred Hindu festival

Land mine explosion kills 11 Sri Lankan soldiers

Japan claims StarLink found in U.S. corn sample

Thai party announces first coalition partner


COVER: President Joseph Estrada gives in to the chanting crowds on the streets of Manila and agrees to make room for his Vice President

THAILAND: Twin teenage warriors turn themselves in to Bangkok officials

CHINA: Despite official vilification, hip Chinese dig Lamaist culture

PHOTO ESSAY: Estrada Calls Snap Election

WEB-ONLY INTERVIEW: Jimmy Lai on feeling lucky -- and why he's committed to the island state


COVER: The DoCoMo generation - Japan's leading mobile phone company goes global

Bandwidth Boom: Racing to wire - how underseas cable systems may yet fall short

TAIWAN: Party intrigues add to Chen Shui-bian's woes

JAPAN: Japan's ruling party crushes a rebel at a cost

SINGAPORE: Singaporeans need to have more babies. But success breeds selfishness

Launch CNN's Desktop Ticker and get the latest news, delivered right on your desktop!

Today on CNN

Back to the top   © 2000 Time Inc. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines.