SenseTime Seeks to Raise Up to $768 Million in Hong Kong IPO
(Bloomberg) -- China’s biggest artificial intelligence firm SenseTime Group Inc. is seeking to raise as much as $768 million from a Hong Kong initial public offering in a test of investor appetite in volatile stock markets.
The company is offering 1.5 billion shares at between HK$3.85 and HK$3.99 apiece, raising nearly HK$6 billion at the top end of the range, according to the terms of the deal obtained by Bloomberg News. Books open on Monday, pricing is expected on Dec. 10 and listing is slated for Dec. 17.
The move comes at a time of increased volatility for listings and amid a drought for big IPOs in the Asian financial hub. China Tourism Group Duty Free Corp., the world’s largest travel retailer, decided last week to suspend a $5 billion listing in Hong Kong, citing sluggish capital markets and the pandemic. The move indicates just how weak the sentiment is at the moment, analysts said.
Adding to woes, Chinese shares listed abroad slumped at the end of last week after Didi Global Inc. said it would delist in the U.S. and list in Hong Kong. The stock slumped 22% in New York on the back of the decision and triggered a sixth day of losses for the Nasdaq Golden Dragon China Index, which tracks 95 firms listed in the U.S. that conduct a majority of their business in China.
People familiar with the matter told Bloomberg last month that SenseTime was seeking to raise at least $1 billion from the share sale. The SoftBank Group Corp.-backed company, which makes AI technology that interprets images and recognizes faces, started gauging investor demand on Nov. 23 and said in its IPO prospectus that it was not involved in any regulatory probe or received any inquiries related to cybersecurity.
Several Chinese IPOs have been directly impacted by a wide clampdown by Beijing authorities over companies seeking to go public abroad, including many that hold large data about Chinese citizens.
Eight cornerstone investors committed to subscribe for $450 million in SenseTime shares, the terms show, representing about 59% of the offering. They include Mixed-Ownership Reform Fund ($200 million) and Pleiad Fund ($50 million).
The Hong Kong Economic Journal reported details of SenseTime’s offering earlier citing listing documents. CICC, Haitong and HSBC are joint sponsors for SenseTime’s deal.
©2021 Bloomberg L.P.