Facebook-related stocks soar on Hangzhou plans
Chinese companies that have business dealings with Facebook Inc saw their shares surge on Wednesday after the United States-based social networking heavyweight confirmed it has set up a local unit.
Shares of Blue Focus Intelligent Communications Group Co Ltd, an advertising agent for Facebook in China, were up 10 percent, the maximum daily rise, on the Shenzhen Stock Exchange to 5.89 yuan (87 cents), marking one of its best days in half a year.
Sichuan Xunyou Network Technology Co Ltd and Shenzhen Zhongqing Game, which conduct business with Facebook, also saw their shares skyrocket by the 10 percent limit in Shenzhen.
Such strong market performances came after Facebook set up a subsidiary in Hangzhou, capital of Zhejiang province, which is also the hometown of Chinese e-commerce giant Alibaba Group Holding Ltd.
"We are interested in setting up an innovation hub in Zhejiang to support Chinese developers, innovators and startups," Facebook said in a statement. "We have done this in several parts of the world－France, Brazil, India, South Korea－and our efforts would be focused on training and workshops that help these developers and entrepreneurs to innovate and grow."
Named Facebook Technology (Hangzhou) Co Ltd, the unit was registered with capital of $30 million and has wide-ranging business scope, including technology development, technical services and investment consulting, according to information on China's National Enterprise Credit Information Publicity System on Tuesday. But the filing is no longer accessible on Wednesday.
Facebook is working hard to enter into the China market, where consumers are very responsive to new technologies and heavily dependent on social networking apps, said Lu Zhenwang, CEO of Shanghai-based Wanqing Consultancy.
Last year, the US company launched a photo-sharing app called Colorful Balloons for the Chinese market. It was released by partnering with a company called Youge Internet Technology.
Apple Inc, Microsoft Corp and Google Inc have all made efforts to attract Chinese developers either through new local research and development centers or by holding frequent developer conferences.
