A bike-sharing platform, a podcaster, and a cloud computing firm are among corporates holding off plans.
At least three Chinese companies have put their plans to list in the U.S. on hold, heralding a slowdown in what’s been a record start to a year for initial public offerings by mainland and Hong Kong firms.
A bike-sharing platform, a podcaster, and a cloud computing firm are among popular Chinese corporates holding off plans for a U.S. float, put off by recent market declines, souring investor sentiment toward fast-growth companies and lackluster debuts by peers like Waterdrop Inc.
Hello Inc., Ximalaya Inc., and Qiniu Ltd. are postponing plans to take orders from investors, even though the three had filed paperwork with the Securities and Exchange Commission well over two weeks ago. In the U.S., companies can kick off their roadshows two weeks after filing publicly, and most typically stick to that timetable.
“The recent broad market selloff, combined with the correction of the IPO market since the beginning of last month when some new issuers tanked during their debuts, may make the market conditions less predictable for newcomers who are ‘physically’ ready -- meaning they have cleared all regulatory hurdles for IPO -- to get out of the door,” said Stephanie Tang, head of private equity for Greater China at law firm Hogan Lovells. “Some participants may choose to monitor the market for more stable conditions.”
The delays throw a wrench in a listings flood by Chinese and Hong Kong companies in the U.S. that already reached $7.1 billion year-to-date -- the fastest pace on record -- after booming in 2020. Demand for IPOs surged as a wave of global stimulus money, ultra-low interest rates, and rallying stock markets lured investors despite Sino-American tensions and the continued risk of mainland stocks being kicked off U.S. exchanges.
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