Sina Has Lost 78 Million On Its Mecox Lane And Tudou Investments

  • Posted by
  • on October 12th, 2011

Sina ($SINA) is proving again that most companies, even very good ones, make bad minority strategic investors.

Sina purchased 1,075,000 shares at $29 as part of Tudou’s ($TUDO) August 17 IPO. Sina continued buying after Tudou began trading, accumulating another 1,492,570 shares at an average price of $23.60. Sina’s average cost for its 2,567,570 share stake is $25.86. Tudou’s stock closed Tuesday at $14.64, so in just over two months Sina has lost $28.8m.

In early March Sina ($SINA) announced it was investing in retailer Mecox Lane-Sina to Buy $66 Million Mecox Lane Shares From Sequoia in E-Commerce Push – Bloomberg. Sina paid $6 per share. Mecox Lane ($MCOX) closed Tuesday at $1.41. In just over seven months Sina has a paper loss of more than $50m.

Cost to shareholders so far? Over $78m.

If Sina makes another investment in a public company, perhaps investors should consider the target a good short idea?

You can follow me @Niubi on Twitter@Bill on Stocktwits and @Billbishop on Sina Weibo.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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