Acorn hires new bookrunners for scaled-down offering

PUBLISHED : Thursday, 01 March, 2007, 12:00am
UPDATED : Thursday, 01 March, 2007, 12:00am

Acorn International, the mainland's largest television home-shopping company, has hired a new set of bookrunners for a downsized US$125 million initial public offering on the Nasdaq, market sources said.

The firm has brought in Merrill Lynch and Deutsche Bank to replace Credit Suisse and Morgan Stanley which were hired for an up to US$200 million fund-raising slated for last year.

Acorn was forced to delay that IPO after revenue forecasts fell when Beijing implemented new advertising regulations, according to people familiar with the situation.

The new rules barred companies from making outlandish claims for health and beauty products that could not be substantiated.

Acorn, which sells about 60 brand-name consumer products through commercials on mainland satellite television channels broadcast nationwide, relies heavily on the cosmetics and health and fitness industries. Companies selling home electronics and automotive products are also major clients.

Acorn estimates that the mainland home-shopping market will be a US$2 billion industry by next year.

Hong Kong-based private equity firm SAIF Partners invested US$35 million in Acorn in 2005.

Japan's Oaklawn Marketing, which markets home and leisure products, was one of Acorn's founders in 1998.

Other mainland firms planning a Nasdaq IPO include mobile-phone chip designer Spreadtrum Communications which intends to sell US$200 million worth of shares.