Xunlei Said to Resume IPO Plan
SHENZHEN, Oct 30, 2012 (Menafn - SinoCast Daily Business Beat via COMTEX) --Shenzhen Xunlei Network Technology Ltd., the Chinese video and music file-sharing firm partly owned by Google Inc., is expected to resume its IPO plan soon.
It formally submitted an application to the US Securities and Exchange Commission (SEC) for an IPO on the US stock market on June 9 and according to the prospectus, it intended to raise USD 200 million from the share issue. The IPO size was slashed owning to unsatisfactory market environment later and due to sharply dropped demand rooted from a list of accounting scandals of Chinese-concept stocks, it thoroughly gave up the IPO plan one month later.
Sources said recently that it was weighing a plan to sell a strategic stake to Chinese online security and privacy protection service provider Qihoo 360 Technology QIHU or Baidu, Inc. BIDU, the biggest Chinese-language online search service provider in the world. Zou Shenglong, CEO of it, denied the report, stating that it received an injection of USD 30 million in March this year and the capital would allow it to run normally for one year.
People in the know pointed out that actually, the CEO did not rule out the possibility of investment from Qihoo 360 or Baidu. In other words, the firm did not want to introduce any large-sized new shareholders before the long-awaited IPO. Considering all those, there was possibility for it to be in talks with Qihoo 360, Baidu and other investors and as a strategic investor, the latter might take part in its IPO. And the timetable might be the end of this year. Baidu had been an initial investor of it, but the investment size was small. And provided that it wanted to have a bigger say in the latter and strengthen its ability in online video therefore to well compete with domestic archrivals including Tudou and Youku.com, there would be no doubt that it would participate in the IPO. Xunlei would benefit from this too as brand awareness of both Baidu and Qihoo 360 was high at abroad and participation of them would help it attract investors that worried much about accounting scandals of China-concept stocks. The strategic investment from either of them, or other investors, would be about USD 30 million to USD 50 million and under such an environment, it needed to raise only USD 50 million to USD 70 million from the IPO.
Tv.sohu.com, the online video unit of Chinese Internet portal Sohu.com Inc. SOHU, is expected to file for an IPO at the end of this year, too.
(USD 1 = CNY 6.24)
Source: www.163.com (October 30, 2012)
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