China tech giants Weibo parent Sina and search engine Sogou to delist from US
The parent company of China’s vast Weibo platform and among the country’s biggest se's have announced plans to delist from US stock markets in deals totalling over $6 billion as relations between Washington and Beijing grow increasingly tense.
Chinese internet search engine Sogou confirmed Tuesday it could be taken private by tech giant Tencent, in a deal that values the New York-listed firm at around $3.5 billion.
The announcement comes a day after Chinese internet giant Sina Corp-which owns the country’s massive Twitter-like Weibo-said it would go private aswell.
An increasing number of Chinese companies have delisted from the US or opted for secondary, domestic listings as the world’s two superpowers butt heads over several issues including technology, Hong Kong and the coronavirus.
Sohu.com, which is Sogou’s parent company, said in a statement on Tuesday that the price will be at $9 per share.
This represents a premium of approximately 56.5 percent to the closing trading price of Sogou on July 24, shortly prior to the company announced it had received a proposal ongoing private from Tencent.
If the share purchase is completed, Sohu’s subsidiary Sohu.com (Search) will receive an aggregate consideration of around $1.18 billion in cash, and Sohu won't have any beneficial ownership interest in Sogou.
Meanwhile, Sina Corp plans to cease trading on the tech-rich Nasdaq exchange-where it has traded since 2000 -- after a deal valuing the firm at $2.59 billion.
Hong Kong or Shanghai
China has previously lost the listings of internet giants such as for example Alibaba and Baidu to Wall Street, but it is seeking to change the situation-especially as tensions rise with the united states and its particular capital markets mature.
Tighter US rules could push companies towards Hong Kong or Shanghai, with e-commerce giants Alibaba and JD.com having launched huge offerings in Hong Kong in the past year.
Alibaba’s financial arm is planning a mega dual IPO in both cities as well.
China has eased listing rules in the last year or two to inspire more domestic share issues by big Chinese tech firms, as Beijing challenges the US for global tech dominance.
The push is the main Communist Party’s strategy to develop domestic champions into global leaders in artificial intelligence, big data, and other advanced sectors.
China’s major chipmaker Semiconductor Manufacturing International Corporation (SIMC), which previously delisted in america aswell, announced earlier this season it could seek a Shanghai stock listing.
Source: www.deccanchronicle.com
