Phoenix unit targets US$205.6m

Phoenix New Media, a subsidiary of Hong Kong-based Phoenix Satellite Television Holdings, intends to offer about 12.8 million American depositary shares priced between US$12 and US$14 in its spin-off listing in the United States.

In a filing with the US Securities and Exchange Commission, the Beijing-based company says it expects to raise as much as US$205.6 million from its initial public offering and has applied to trade its shares on the New York Stock Exchange.

Phoenix New Media is the leading domestic supplier of news and other premium content across the internet, mobile networks and television channels on the mainland. It was founded in 2000 and incorporated in 2007 as a subsidiary of global Chinese-language broadcaster Phoenix TV, which is partly owned by wireless network giant China Mobile and Xin Kong Chuan Mei Group, a unit of News Corp's Star TV Group.

Phoenix TV, which controls 62.44 per cent of Phoenix New Media, will retain beneficial ownership of 52.17 per cent and voting power of 58.65 per cent after the spin-off.

Based on its proposed share price range, Phoenix New Media will have an estimated market capitalisation of between US$907 million and US$1.1 billion after the listing.

Phoenix TV chairman and chief executive Liu Changle, in a filing with the Hong Kong stock exchange yesterday, said Phoenix New Media and the underwriters were expected to determine the final offer price 'on or about May 11, New York time'.

Liu said Phoenix TV shareholders would receive one American depositary share in the spun-off company for every 10,000 shares they held in the parent firm.

The estimated net proceeds from the spin-off listing would be US$135 million at a final offer price of US$13 per American depositary share, each one representing eight Class A shares.

Phoenix New Media will use US$60 million of the net proceeds for content acquisition and production, US$40 million for product development and technology, US$30 million for marketing and sales, and the rest for general corporate purposes.

The underwriters for the share offering include Morgan Stanley, Deutsche Bank Securities, Macquarie Capital (USA), Cowen and Co, and China International Capital Corp Hong Kong Securities.

Social-networking provider Renren and dating site operator Jiayuan.com International also announced their US listing plans this month. They plan to raise US$584 million and US$100 million, respectively.

Planned NYSE listing

Phoenix New Media expects the offer price of its American depositary shares to be at least, in US$: $12