International

Will China Fast-Track Its Initial Public Offerings?

Reuters reports that the nation’s securities watchdog is in the midst of mulling a “shortcut” that would offer some of the biggest tech firms in China a way to bring their shares public in a fast-tracked manner. In other words, they’d get to list sooner rather than later.

And if they get sped to market, so to speak, they’d leap ahead of what the newswire termed “a long list of applicants” already in the offing for listing via exchanges, a heady number that tops 700. That insight comes from a number of sources (actually, a half-dozen) unnamed by Reuters. The average wait as defined to come to market can be as long as 18 months. That lags other countries, such as the United States, and so the listings naturally gravitate toward where times are relatively shorter.

The relaxation of some listing rules might help tip the balance of firms of scale and size listing in China, as among the 400 tech firms listed in Shanghai and Shenzhen, most are valued at about $1.9 billion, which is leagues below the Ant Financial implied threshold. (Indeed, the highest tech market caps in China belong to Hikvision Digital Technology and display maker BOE Technology Group [000725.SZ] with respective $25.7 billion and $16.9 billion market caps.)

One marquee name that can stoke the fires of any “list in China” movement comes with the $25 billion debut of Alibaba in New York three years ago. And, as Reuters noted, another firm, Qihoo, went private for $9 billion but now may come public in China. That would help diversify away from the conglomerates and state-owned enterprises that have typically held sway in the Chinese markets.

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