Internet Capital Group, Inc. (ICG) and Hong Kong’s Hutchison Whampoa Ltd. have partnered to develop business-to-business (B2B) e-commerce in Asia.
The $62 billion (US$) Hutchison Whampoa is controlled by Asian billionaire Li Ka-shing. His group of companies makes up 16 percent of the Hong Kong stock market’s total capitalization and his personal wealth was estimated in 1999 by Forbes magazine at $12.7 billion.
The companies are starting two new businesses. The first will aim to acquire e-marketplace makers and other B2B infrastructure companies, while the other will serve as an e-commerce portal for companies in the region.
The companies cited a GartnerGroup report that foresees worldwide B2B e-commerce growing to $7.3 trillion by 2004, with about $1 trillion generated in Asia.
Plan Includes $200 Million Purchase
The companies said they plan to buy a $200 million controlling stake in Hong Kong toy manufacturer Harbour Ring International Holdings.
The firms said that Harbour Ring will be renamed ICG AsiaWorks Ltd., and will acquire and build market makers and infrastructure companies. They added that it will also operate several “business incubation centers” in Hong Kong and China to serve as a platform for bringing the new companies to those regions, and to start new Asian-based companies.
High Hopes for Procurement Venture
The companies said they expect the other venture — the procurement services company — to be formed next month. The partners said they plan to bring other “large corporations” into the venture, which they aim to make into “the definitive neutral B2B buying and selling portal in Asia.”
Internet Capital Shares Rise
ICG, based in Wayne, Pennsylvania, is a holding company that invests in and grows B2B e-commerce companies. On Wednesday, the company said it would buy a majority stake in RightWorks, a privately held software maker, for $657 million in cash and stock. ICG shares were up 1-9/16 in Thursday morning trading to 139-11/16.
Hutchison Whampoa, which has been expanding its Internet-related businesses, recently forged a fiber optic broadband network venture with Global Crossing Ltd. (Nasdaq: GLBX) and an alliance with Priceline.com (Nasdaq: PCLN) to bring e-commerce services to Asia.