The China Securities Regulatory Commission (CSRC) recently announced rules for domestic companies considering overseas IPOs.
According to people familiar with the matter, Chinese cloud service provider Shenzhen Cloudsky Technologies is considering an initial public offering (IPO) where it could bring in around $200 million. The sources revealed that the company’s plan to go public could happen as soon as this year. Currently, Shenzhen Cloudsky has not made a final decision on its listing locations, but tipsters saying The United States is one of the possible places for an IPO.
Shenzhen Cloudsky Technologies considers IPO in the US
As the company awaits its public debut, it has begun reaching out to advisers. If Shenzhen Cloudsky is successful in the initial public offering, the company is seeking a $1 billion valuation. The sources noted that the matter of the public offer is still private and still in its early stages. Therefore, details are subject to change. However, if Shenzhen Cloudsky is listed in the US, the company will join the growing list of Chinese companies filing an initial public offering in the country. The recent drama with Didi intensified efforts by Chinese agencies to implement laws to guide overseas listings.
The Cyberspace Administration of China (CAC) said Didi violated data security laws when it went live on the New York Stock Exchange (NYSE) in June 2021. CAC accused the shipping company of violating national network security, personal information protection and data security. laws. This resulted in a $1.19 billion fine for the company and an 18-month suspension in China.
Shenzhen Cloudsky specializes in Visual Cloud and was founded by talent from Sony Group Corp. and technology and entertainment conglomerate Tencent. The founding team also came from Intel Semiconductor Corporation (NASDAQ:INTC), Huawei Technologies, etc.
Shenzhen to comply with new laws on overseas public offerings
The China Securities Regulatory Commission (CSRC) recently announced rules for domestic companies considering overseas IPOs. The Commission stated that all Chinese establishments must observe national security measures before considering public offerings abroad. At the same time, they must ensure that they comply with data protection law. Since all the new laws regarding foreign IPOs take effect from March 31, underwriters must also inform the Commission about their participation in international listings. This means that Shenzhen Cloudsky may also need to observe the new laws if it decides to proceed with its US IPO.
In addition, the CSCR also established the penalties for breaking the rules for both individuals and organizations. Anyone who violates the orders could face up to 10 million yuan ($1.5 million). This same consequence applies to companies and individuals who share misleading information with the public.
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Ibukun is a crypto/finance writer interested in conveying relevant information, using non-complex words to reach all kinds of audiences. In addition to writing, he enjoys watching movies, cooking, and exploring restaurants in the city of Lagos, where he resides.
