The Weekly News Update is a weekly roundup of business news from around the Asia-Pacific region, covering Fusion Consulting's core industry practices: chemicals, consumer & retail, financial services, industrial & logistics, information & communication technology, life science and media & leisure. If you have colleagues or friends who may be interested in subscribing, please forward this email to them and copy knowledge@fusionc.com.  2008 Asia-Pacific pay-TV operators survey, 4th edition   Find out what the major cable, satellite and IPTV platforms in Asia and Australia  think about all the major pay-TV channels, their programming plans and their  hopes and fears for the future of the industry. This survey questioned  programming managers at major carriers in 16 countries across the region,  focusing on the largest players in each country and covering one third of the 120  million regional subscriber base. In cooperation with ContentAsia.  Request more information. In the news this week l 18-Apr-08 Japan's M&A market starts to stir

Japan's M&A market more than doubled to US$153 billion in 2007 from US$64 billion in 2002, despite the relative novelty of the concept to domestic companies and the oft-cited difficulties of cross-border transactions. While there may be risk such as the inability to integrate new employees into its culture, Japanese corporations are now getting used to the idea of M&A as a strategic tool. Japan's largest drug maker Takeda Pharmaceuticals had last week unveiled the largest ever acquisition of a foreign biotech by a Japanese drug-maker, paying US$8.8 billion for US drug maker Millennium Pharmaceuticals. Takeda Pharmaceutical's purchase of Millennium Pharmaceuticals is raising hopes that more biotech deals are on the horizon. In December 2007, fellow Japanese operation Eisai acquired another US firm, MGI Pharma, for US$3.9 billion.

Chemical China - Kemira expands its production of water treatment chemicals Source: Chemie, 15 April 2008 Kemira will multiply its production capacity in water treatment chemicals in central China. It will invest in a new production line for the manufacturing of polyaluminium chloride, with a capacity of 20,000 tons per year. The company's current annual capacity for production of this chemical at the Chongqing plant is 6,000 tons. The expanded production line will be ready for use in the first quarter of 2009.    Kemira Water Solutions (Chongqing) serves mainly the water treatment needs of the Chongqing autonomous area in terms of both drinking water and industrial wastewater. The new investment allows for an expansion of the customer base in both the Chongqing area and the neighboring Sichuan province. China - Sinopec, Mitsubishi Chemical to form resin JV Source: Sinocast China Business Daily News, 10 April 2008 Japan-based Mitsubishi Chemical Corporation will set up a Beijing joint venture with Mitsubishi Engineering-Plastics Corporation (MEP) and China Petroleum & Chemical Corporation. The new venture is expected to produce 150,000 tons of bisphenol A (BPA) and 60,000 tons of polycarbonate resin a year. Polycarbonate resin is used to make CD-ROM and auto parts and BPA is an important raw material for the production of epoxy resins and polycarbonate resins. The production of each ton epoxy resin would need about 750 kilograms BPA. China, the No. 1 epoxy resin producer and consumer worldwide since 2006, made around 720,000 tons in 2007, and used around 400,000 tons imported and about 100,000 tons home-made BPA in the production. Japan - Daiso to Up Epichlorohydrin capacity to 100,000 ton/year Source: Japan Chemical Week, 10 April 2008 Daiso plans to almost double its output capacity for epichlorohydrin, thus establishing a 100,000 ton/year production setup. The company is also studying the possibility of overseas production as well as a new process technology that uses glycerin instead of propylene as feedstock. Demand for epichlorohydrin has been expanding steadily, especially for use in epoxy resins and in overseas markets such as China and India. To accommodate rising demand, Daiso intends to boost its capacity by 15,000 ton/year to 70,000 ton/year within the next three years. It proposes to do this by eliminating bottlenecks either at the Mizushima or Matsuyama plant, and has allocated capital investment of Y1-2 billion (US$10-20 million) to the project. View an example of our experience in this industry.

Consumer & retail India - FMCG industry grew 16% in 2007-08 Source: Press Trust of India, 13 April 2008 The Indian FMCG industry, valued at Rs746.5 billion (US$18.8 billion) in 2006-07, grew by 16% in 2007-08 compared to 14.5% growth in the previous fiscal, according to a survey by industry body Ficci. The high growth in the sector is backed by the rising demand, fiscal incentives provided by the government such as tax exemptions in some states and improved performance by leading companies. Driving the growth of the sector, the 'deodorant' segment of the industry has achieved the highest growth of 40% followed by hair dye at 30% and chemical segments including cleaner and repellents at 23%. However, there has been some deceleration in the soap and toiletries segment. Korea - Hollys Coffee opens first US store Source: Korea Herald, 15 April 2008 Hollys Coffee, Korea's largest coffeehouse chain, has opened its first store in the United States. The company's American debut in Los Angeles, California, follows Hollys' first overseas entry in Kuala Lumpur, Malaysia in 2007, with plans to open two more stores this year. Hollys' entry into the United States signals Korea's readiness to compete in the global market with a build-up of know-how and expertise in the art and management of coffee brewing. The coffeehouse ranks second in the domestic market in terms of number of stores, which currently totals 135. Starbucks leads the market with over 200 stores, while Coffee Bean ranks third with 110 stores. Pakistan - Pakistan Food & Drink Outlooks Source: Business Wire, 10 April 2008 The outlook for the canned food industry - which can exploit rising demand for convenience and consumer fears over food origin and hygiene - and the soft drinks industry - which can capitalise on the aspirational demands of Pakistan's young population - have both been moderately accelerated. Forecast canned food sales growth to 2012 now stands at 46.7%, while soft drinks sales growth to 2012 is forecast to stand at 36.4%. The downside of all these attractive growth signs is quite simply that they are not yet attractive enough to offset the risks of investing in Pakistan. In limits terms, food and beverage spending levels remain low due to acute price sensitivity among certain consumer groups, particularly those in rural areas. View an example of our experience in this industry.

Financial services Asia - Private equity deals up in Q1 Source: Business Times Singapore, 14 April 2008 The Asia-Pacific (excluding Japan) received 195 private equity deals in the first quarter of 2008, up from 183 deals in the same period in 2007. But Thomson Financial revealed that the sums invested have declined to US$1.67 billion from US$2.64 billion. In the first quarter of 2008, China led the pack in attracting US$571 million in private equity funding, while India came in a close second with US$507 million. But Taiwan and Vietnam stood out when it came to the rate of private equity investment growth in the Asia-Pacific. Vietnamese firms received US$36 million in the first quarter of 2008, a jump from US$1.9 million in the same period in 2007. Indonesia - Syariah-compliant products gets a boost from new law source: Business Times Singapore, 14 April 2008 Indonesia's parliament passed a new Syariah debt bill in early April 2008, paving the way for the government and corporate borrowers to tap the fast-growing market for Islamic financial products. By offering Syariah-compliant financial products, predominantly Muslim Indonesia hopes to attract more funding for essential infrastructure from wealthy Middle Eastern investors, as well as from local banks, funds and retail players. Thanks to the new law, banks such as HSBC Indonesia expects corporate demand for Syariah-compliant products to take off. In addition, Indonesia's economy has entered a period of higher growth and the country is taking the right steps to attract more foreign investment. Korea - Car insurance premiums surpass US$10.2 billion Source: Korea Herald, 14 April 2008 Korean car insurers' revenues broke the W10 trillion (US$10.2 billion) mark for the first time, during the fiscal year 2007. According to the insurance industry, local car insurers raked in an estimated W10.8 trillion (US$11 billion) during the fiscal year that ended on 31 March 2008. This is an increase of 11.8% over the W9.7 trillion (US$9.9 billion) recorded in the previous year. The increase has in part been fueled by the rise in the number of expensive imported vehicles being registered and the greater popularity of sport utility vehicles. The insurance premiums of these vehicles need to be raised in tandem with the increasingly expensive prices of vehicle. View an example of our experience in this industry.

Industrial & logistics Asia - TNT pumps US$160 million within next five years Source: Channel NewsAsia, 11 April 2008 Express integrator TNT will invest nearly US$160 million into Southeast Asia within the next five years. This will be used mainly for infrastructure developments and aircraft operations. TNT is looking to tap into growing demand for freight express services between Southeast Asia, China and Europe. Over the last year, its cargo volumes between China and Europe alone have grown by more than 20%. TNT said direct investment into Singapore is estimated to come up to nearly US$40 million. That's about a quarter of the total investment into the region. The logistics sector accounted for 9.4% of Singapore's GDP in 2007, and employed about 180,000 people. China - Auto makers report soaring Q1 sales Source: Xinhua Business Weekly, 14 April 2008 Global auto makers reported soaring first-quarter sales in China as they stepped on the accelerator to jostle for position in the world's fastest growing vehicle market. The sales growth of almost all the big global names far outpaced the industry average in China; passenger car sales rose 20.4% to US$1.9 million in the first three months and 24% in March, the biggest monthly rise since August 2007. In contrast, their sales experienced double-digit declines in the United States last month as demand fell and consumers held back amid concerns about gas prices, the subprime mortgage crisis and tightening credit. India - Auto sales drop 4.7% Source: Business Standard, 11 April 2008 Marking a forgettable year for the Indian automobile industry, marred by high interest rates and lack of finance availability, vehicle sales in India dropped by 4.7% in 2007-08. The overall decline in sales was due to a decline in sales of motorcycles, three-wheelers and goods carriers in the medium-and-heavy-commercial vehicle segment. According to figures released by the Society of Indian Automobile Manufacturers (SIAM), total domestic vehicle sales in 2007-08 was down at 9,648,105 units, compared with 10,123,988 units in the previous financial year. View an example of our experience in this industry.

Information & communication technology   China - Investment growth in IT and electronics industry slows down Source: Xinhua's China Economic Information Service, 08 April 2008 The growth of fixed-assets investment in China's electronics and IT industry maintained a downtrend in the first two months of 2008. China's electronics and IT industry realised fixed-assets investment of RMB24.4 billion (US$3.5 billion) in the first two months, up 20.5% year on year, but the growth rate was 15.3% points lower than the average of manufacturing industries in the country. The number of newly constructed projects in China's electronics and IT industry increased by 60 year-on-year to 245 in the first two months of 2008, involving a total planned investment of RMB12.5 billion (US$1.8 billion), down 38.3%. India - Notebook sales jump 158%, drive PC sales growth Source: Indian Express, 11 April 2008 The boom in notebook computers is driving the personal computer sales growth in India. With several first-time PC buyers now opting for notebook computers rather than desktops, notebook sales recorded a 158% growth over the third quarter in 2006-07. The high growth in notebook consumption can be attributed to the drop in notebook prices and the additional benefit of mobility and space management. The total PC sales between October and December 2007, with desktop computer and notebooks taken together, were 1.8 million units, registering a growth of 26% over the same period last fiscal. Japan - Continued Growth in Telecoms, Mobile and Broadband Source: Business Wire, 11 April 2008 Japanese broadband subscribers comprised around 8.5% of the world subscriber base going into 2008. Coming into 2008, the country was witnessing the continued growth of VoIP and triple-play services in particular. Especially noteworthy has been the uptake of FttH services (with a corresponding move away from DSL) and the big strides taken in developing digital and mobile broadcasting. Japan is one of the world's leading mobile telephone markets, in terms of size, innovation and its ability to be early with the introduction of advanced technologies. Japan is one of the world's top 3G markets, with over 80 million (80%) 3G subscribers by the end of 2007, as well as plans for 4G. View an example of our experience in this industry.

Life science Japan - Takeda to buy Millennium Pharma Source: The Wall street Journal, 11 April 2008 Takeda Pharmaceutical will buy US biotech firm Millennium Pharmaceuticals for US$8.8 billion to boost its cancer drug business. The acquisition will give Takeda control of Millennium's cancer drug Velcade, which is used to treat multiple myeloma, a bone marrow cancer. Developing cancer drug pipelines has been a top priority for Japanese drug makers which have been late to step into the lucrative business.  The deal comes on the heels of rival Eisai's US$3.9 billion purchase of cancer specialist MGI Pharma. It also follows Takeda's agreement with Abbott Laboratories in March 2008 to split their 50-50 joint venture TAP Pharmaceutical Products. Singapore - C&O Pharma in venture with US outfit Source: Business Times Singapore, 15 April 2008 Singapore's C&P Pharmaceutical Technology Holdings aims to ride the global trend to outsource research to Asia by setting up a joint venture with US contract research organisation (CRO) XenoBiotic Labs. The move is part of the company's diversification strategy, as demand for contract research services booms - especially in China where the world's top pharmaceutical companies have already set up laboratories. According to medical market research publisher Kalorama Information, the worldwide market for outsourced drug discovery is expected to grow 15% a year from US$4.1 billion in 2005 to US$7.2 billion in 2009. Singapore - Biomedical sciences sector grows fourfold from 2000 Source: Channel NewsAsia, 15 April 2008 Singapore's output in biomedical sciences has increased fourfold reaching S$24 billion (US$17.7 billion) last year, up from S$6.3 billion (US$4.6 billion) in 2000, when the government began to develop the sector. Biomedical sciences - pharmaceuticals, biotechnology, medical technology and healthcare services - last year made up 10.1% of all manufacturing output in Singapore. Asia's expanding market opportunities and talent pool are major "pull factors" for investors, and Singapore is a strategic location for companies' expansion into the region. View an example of our experience in this industry.

Media & leisure India - Turner launches animation films unit Source: Business standard, 11 April 2008 Turner International significantly upped its grab for a larger part of India's US$12.8 billion entertainment industry, by launching its first international animation theatrical production business and also a Hollywood movie channel with sister company Warner Bros. Turner's animated film production unit will expand the company's output of original live-action TV for kids. PricewaterhouseCoopers' March 2008 report on the India's entertainment and media industry projects 22% growth during the next five years. This means the overall television industry will be worth US$15 billion in 2012, up from US$5.6 billion in 2007. Indonesia - Government blocks Astro's broadcast Source: Jakarta Post, 12 April 2008 The Indonesian government has blocked the broadcasting of Malaysia's subscription television operator Astro due to its failure to meet obligations including failing to pay fees for using certain frequency bands. Astro is managed in Indonesia by PT Direct Vision. There are two systems - cable and satellite - available in Indonesia, operated by five major players; Indovision, Indosat IM2, Astro, First Media and Telkom Vision. Around 500,000 households in Indonesia subscribe to satellite-based television, while 200,000 use cable. Subscribers to the five local operators grew from 476,000 in 2006 to 700,000 in 2007. Singapore - New rating system for video games Source: My Paper, 15 April 2008 Singapore's Media Development Authority (MDA) has introduced a classification system for video games. The ruling rates titles as Mature 18 (M18) for gamers aged 18 and above, and Age Advisory for those aged 16 and older. The new classification system will take effect on 28 April 2008. Singapore is the first country in Southeast Asia to have its own system for rating games - which will give more choice for adults and protect the young from unsuitable games. Other countries such as the United States, Australia, Japan and the United Kingdom have developed their own ratings systems since there is no global standard for rating games yet. View an example of our experience in this industry.

Previous issues

Beverage firms in India focus on fruit drinks, target teens [10-apr-08] Banks target Asia's wealthy [4-Apr-08] Foreign investors unfazed by Vietnam's economic difficulties [24-Mar-08] India's chemical sector benefits from China's cut in export rebates [20-Mar-08] Foreign game makers accelerate Asian drive [14-Mar-08] Asian players withdraw from fiercely competitive Chinese handset market [7-Mar-08]     What you don't know can hurt you  Receive all the key news on your markets, industry and competitors each  week, with alerts for important breaking news, and avoid information  overload with human filtering. Find out more about our Market Monitoring   Service and web-based Intelligence Plaza system by emailing   marketing@fusionc.com.

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