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Tech companies IQiyi, Bilibili extend rush by China firms to list in US
TWO more large technology companies in China have launched initial public offerings to begin trading in New York.
The filings on Friday by Baidu Inc's Netflix-style video streaming service iQiyi Inc and video site Bilibili Inc come on the heels of 21 new listings last year by Chinese companies on US exchanges.
IQiyi aims to raise as much as US$2.4 billion, offering 125 million American depositary shares at US$17 to US$19 apiece, according to its filing with the US Securities and Exchange Commission. Bilibili said in its filing that it intended to raise as much as US$525 million, offering 42 million depositary shares for US$10.50 to US$12.50 each.
Chinese companies hungry for more cash for expansion have increasingly turned to US markets to sell their shares, with last year's total being the most since 2010, according to data compiled by Bloomberg. While investors in 2017's class have lost 11 per cent on a weighted-average basis, the cadence of deals doesn't appear to be slowing.
Tencent Holdings Ltd's music unit and Xiaomi Corp are among the companies that are said to be exploring first-time share sales in Hong Kong or elsewhere. Qu Toutiao, a Chinese news and video aggregation mobile app, is weighing a US IPO at a value of as much as US$3 billion, people with knowledge of the matter have said.
Both iQiyi and Bilibili are online entertainment platforms for streaming video. IQiyi counted 60.1 million subscribers at the end of February, with more than 98 per cent of them paying for services, according to its deal prospectus. The company has focused on producing original content such as variety shows and original dramas.
Total revenue at iQiyi climbed to US$2.7 billion last year with a net loss of US$574 million. The company has applied to list its shares on the Nasdaq Global Market under the symbol IQ in a deal led by Goldman Sachs Group Inc, Credit Suisse Group AG and Bank of America Corp.
Bilibili has focused on a younger audience, with about 82 per cent of its user base having been born in China from 1990 to 2009, according to QuestMobile data cited in the company's IPO prospectus. At the end of 2017, the company had 71.8 million active users on average monthly.
Bilibili posted net revenue of US$379 million and a net loss of US$28 million last year. The company has applied to list on the Nasdaq Global Select Market, under the symbol BILI. Morgan Stanley, Bank of America and JPMorgan Chase & Co are leading the company's deal. BLOOMBERG