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Millet encountered a "stumbling block" How was the value of the 100 billion valuation affected by Cool?

via:中国证券报     time:2018/5/13 11:31:48     readed:544

(Original title: Xiaomi's IPO encounters a “stumbling block”! How much will the 100 billion dollar valuation be affected by the Cooluit lawsuit?)

Cool: Xiaomi always ignores attitude

On May 10, Coolpad Group has issued related announcements:

According to information provided by Coolpad at the media communication meeting, the patent dispute between Coolpad and Xiaomi began in fact as early as 2014.

Cool Chief Intellectual Property Officer Zhang Na introduced that since 2014, Coolpad has repeatedly sent a warning letter to Xiaomi, stating that Xiaomi's production and sales of Xiaomi’s mobile phones are alleged to infringe the patent rights of Coolpad and negotiate friendly matters. However, Xiaomi did not respond. Afterwards, Coolera sent a letter again, Xiaomi still ignored the attitude, and Cool began to initiate legal proceedings.

Zhang Na said that the three patents filed by Coolpad to prosecute Xiaomi are system interaction or UI type patents, and also include multi-card multi-standby technology. They all involve the basic communication, display, and interactive functions of mobile phones and are relatively easy to use on infringing mobile phones. Get and manifest, it is more difficult to avoid and substitute.

In response to Xiaomi’s infringement, Zhang Na said that currently Xiaomi is required to stop production and sales, but the final amount of compensation is decided by the court.

Cool CEO CE Chao said: “If a cumulative tens of thousands of R&D engineers’ achievements in the 25-year day and night are plagiarised without being pursued, we should reflect on our tolerance and ultimately harm the entire society. Innovation."

Xiaomi responded: Patent invalid application filed

For the case of Cool's prosecution, Xiaomi responded to reporters from China Securities Journal that Xiaomi had noticed that Cool had filed a lawsuit with Shenzhen Intermediate People's Court on January 12, 2018. However, on May 10, 2018, Cool announced that it had applied to the trial court to apply for a ban in the case. Xiaomi has not received any notification from the court so far. Millet's business activities are all normal and all mobile phone models are selling as usual.

Xiaomi also said that Xiaomi will actively respond to the lawsuits against Cool. How the stability of several patents for Cool claims rights is questionable. Xiaomi has already submitted an invalid request for several patents submitted by Coolpad. It is expected that this matter will have a fair solution under the legal framework.

It is worth noting that in the mobile phone market, the Red Sea, Xiaomi and Cool mobile phone companies have experienced the baptism of ice and fire. The Coolpad, once a member of "China Cool", has fallen far behind in fierce competition in the industry.

The 2016 annual report of Coolpad Group released on April 18 this year shows that the company’s 2016 revenue was 7.969 billion Hong Kong dollars, with a loss of 4.401 billion Hong Kong dollars. In its financial report, Coolpad said that its performance loss was mainly due to business restructuring, fierce competition in China's smartphone market, and decreased market share and sales during the year.

In fact, not only did Coolpad and Xiaomi suffer a crisis of sales decline in the previous two years, but it eventually turned into a crisis. Lei Jun admitted in the Xiaomi’s listing application: “As far as we know, except for Xiaomi, no mobile phone company has been able to successfully reverse the decline in sales volume. After the rebirth of the fire, Xiaomi has experienced a company that can stably develop for a long time. Currently, we are the world’s fourth-largest smart phone manufacturer and have created a number of smart hardware products, many of which have the highest sales volume.We also built the world’s largest consumer IoT platform, connecting more than 100 million smart devices. ”

Lei Jun reprinted IDC's mobile market report in the first quarter of 2018 on May 8. After Xiaomi's rapid growth in 2017 in China, he continued to maintain a strong growth trend in the first quarter of this year, achieving 41.8% year-on-year growth.

Millet's valuation will be tumbled?

When applying for listing in Hong Kong, will the patent lawsuit of the Coolpad Group affect Xiaomi's listing process and valuation?

Huang Lichong, co-founder of the international real estate asset management company's vertical longitudinal strategy management group, said: "Coolie's case against Xiaomi may not affect its listing process, but it will affect its valuation. This will make potential investors feel a Significant risk."

Xu Bo, vice president of Sino-Thai International Research, believes: “In the preliminary judgment, Cool’s infringement litigation is more difficult to obtain court support. However, this will increase the content of information supplementation and hearing, which will delay the process of Xiaomi’s listing. Its valuation is mainly affected by the market conditions. We believe that delaying the listing is not conducive to Xiaomi's valuation."

According to a report on May 9, people familiar with the matter said Xiaomi’s current valuation is likely to be somewhere between $60 billion and $70 billion. Investors originally believed that Xiaomi might be able to raise at least US$10 billion at a valuation of US$100 billion. However, after seeing Xiaomi’s actual financial data last week, investors have a new valuation. Millet's valuation is more likely to be somewhere between $60 billion and $70 billion. It is not entirely clear that this is because potential investors are deterred from the initial US$100 billion valuation of Xiaomi, or that bankers and Xiaomi executives are seeking to reduce their expectations so that Xiaomi’s stock price can rise on the first day of listing.

What is more noteworthy is that after the listing of new economic enterprises in Hong Kong, they have not been plain sailing.

The new economy unicorn enterprises that had been listed in Hong Kong earlier, such as Zhong An Online, China Wenwen Group, Lei Xi, and Yi Xin Group, suffered a sharp decline in the stock price.

The Hong Kong Stock Exchange chief executive Li Xiaojia stated on May 4 that the Hong Kong Stock Exchange will only act as a supervisor and will not select companies for listing, and the market need not pay special attention to how many new economic companies have made listing applications. He reminded that there are not many new economic enterprises in the past, and the market’s understanding of these companies may not be sufficient. Especially for retail investors, even if the atmosphere is hot, they must keep calm.

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