Xiaomi picks HK for IPO, may raise US$10 billion

BEIJING/HONG KONG: Chinese smartphone and connected device maker Xiaomi is bringing its blockbuster initial public offering (IPO) to Hong Kong, where it could raise about US$10 billion (RM39 billion) in the largest listing globally in almost four years.

The IPO plans, filed yesterday, will be one of the first in Hong Kong under new rules designed to attract tech listings.

The listing is expected to give Beijing-based, Cayman-domiciled Xiaomi a market value of between US$80 billion and US$100 billion, just eight years after it came onto the scene in China, people familiar with the plans told Reuters.

The US$10 billion fundraising target, if achieved, will make it the biggest IPO since Chinese internet giant Alibaba Group Holding Ltd raised a total of US$25 billion through a New York listing in 2014.

The IPO could be launched as early as the end of June, according to the people close to the process who requested anonymity as the details were not yet public.

Two separate people said the company’s valuation would likely be lowered to a bit above US$70 billion. One said Xiaomi was looking to sell about 15% of its enlarged capital in the offering.

Xiaomi declined to comment on the valuation.

Xiaomi’s revenue was 114.62 billion yuan (RM71 billion) in 2017, up 67.5% against 2016, the company said in the IPO prospectus. Operating profit was 12.22 billion yuan, up from 3.79 billion yuan yearon-year. It made a net loss of 43.89 billion yuan versus a profit of 491.6 million yuan in 2016, though this was impacted by the fair value changes of convertible redeemable preference shares. – Reuters