Xinhua to List IPO in Shanghai

Posted by david on Jan 7, 2013 in Blog | 0 comments

The online portal of China’s state-run Xinhua news agency has applied for a Shanghai initial public offering, the securities regulator said, in what would be the second listing of a government website in a year.

Xinhuanet.com’s planned IPO is likely to attract strong interest from investors.  Once listed, Xinhuanet would become China’s second publicly-traded media company backed by the central government, after People.cn Co Ltd (603000.SS), the online portal of People’s Daily that went public last April.

Xinhuanet’s IPO application is being vetted by the China Securities Regulatory Commission (CSRC), the regulator said on its website on Saturday, without indicating when the IPO would happen.

“Xinhuanet and People.cn are comparable in their business model and political status,” said Zhang Zejing, a Beijing-based analyst at Hongyuan Securities. “If you look at People.cn’s debut, you would have an idea how hot Xinhuanet’s IPO could be.”

People.cn attracted pre-IPO investments from state-owned giants including China Mobile Ltd (0941.HK), China Unicom (0762.HK) and China Telecom Corp Ltd (0728.HK) and its shares opened 55 percent higher on the first day of trading.

With reporters based in more than 100 countries and regions, the news portal is the authorized agency to announce appointments of government officials. It publishes news around the clock, in six languages, and generates income from advertising.

More than 800 Chinese companies are queuing to be listed, with some companies having to wait for several years, but Xinhuanet may receive special approval for an IPO due to its political status, analysts said.

Beijing has been encouraging state media to raise funds to allow them to more effectively compete against new media giants such as Sina Corp (SINA.O) and Sohu.com Inc (SOHU.O).

– Reuters