China's GSX Techedu Raises $208 Million in U.S. IPO

(Bloomberg) -- GSX Techedu Inc. shares were little changed in early trading after the Chinese education company raised $208 million in its U.S. initial public offering.

Shares opened at $12.10 in New York Thursday but quickly fell back to the $10.50 offer price. GSX, which sold 19.8 million American depository Wednesday at the mid-point of its targeted range, closed its first day of trading at $10.48 a share.

GSX Chairman and Chief Executive Officer Larry Chen said he wasn’t worried about the lackluster debut or the intensifying U.S.-China trade fight.

“No matter how much problems there are in the economy or between countries, demand for education will still be there,” Chen said in an interview at the New York Stock Exchange.

“Lately, some Chinese companies have paused their U.S. IPO process,” Chen said. “I wasn’t worried at all. If you are a good company, you will still be a good company.”

GSX is the third-largest online after-school tutoring service provider in China, offering classes for kindergartners through 12th-graders, according to its filings with the U.S. Securities and Exchange Commission. For the first quarter, the company’s net income was 17.7 million yuan ($2.6 million), turning around from a loss of 13.3 million yuan for the same period in 2018.

The offering was led by Credit Suisse Group AG, Deutsche Bank AG, Barclays Plc and CLSA Ltd. Shares are trading on the NYSE under the symbol GSX.

--With assistance from Dominic Lau.

To contact the reporter on this story: Crystal Tse in Hong Kong at ctse44@bloomberg.net

To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Michael Hytha, Fion Li

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