China DNA firm unit mulling US$1b Shanghai IPO: sources

[NEW YORK] BGI Group, the world's biggest DNA-sequencing company, is considering an initial public offering (IPO) of its equipment unit on Shanghai's Star board as early as this year, people with knowledge of the matter said.

The Shenzhen-based firm could seek to raise about US$1 billion by selling shares in its subsidiary MGI Tech Co, the people said, asking not to be identified because the matter is private. BGI is working with advisers for the potential listing on China's tech-focused exchange, the people said.

Deliberations are at an early stage, and the size and timing of the IPO could still change, the people said. A representative for MGI declined to comment on IPO-related matters. A representative for BGI referred a request for comment to MGI.

An IPO would follow a series B fundraising round in May that raised more than US$1 billion from investors including IDG Capital and Citic PE, according to a company statement.

Founded in 2016, MGI makes and sells DNA sequencing instruments, reagents and related products to help life sciences research, according to its website. It counts more than 1,000 employees in about 39 countries.

BGI, the parent company, provides genomic sequencing and proteomic services, and works with organisations including academic institutions, pharmaceutical companies and healthcare providers, according to its website.

In July, two of BGI's subsidiaries, Beijing Liuhe BGI and Xinjiang Silk Road BGI, were among 11 Chinese companies added to the US Commerce Department's entity list over their alleged implication in human rights abuses in Xinjiang, subjecting the firms to restrictions on access to US-origin items including technology. BGI issued a response saying there was no basis for including the subsidiaries on the list, and that the company strictly abides by all international business practices and laws.

BGI Genomics Co, a listed subsidiary of BGI Group, is one of three mainland firms helping a team from Guangdong province ramp up Hong Kong's coronavirus testing, the team's leader said in a state media video interview. The team will work with the Hong Kong government and the three labs to help to process 100,000 to 200,000 samples per day.

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