Oak Pacific considers US$500m initial share sale, Xiaonei spin-off

Oak Pacific Interactive, which just received US$430 million from key investors including Softbank, plans to raise as much as US$500 million from an initial public offering or by spinning off its social networking site Xiaonei, known as China's Facebook website, sources said.

'These companies have a bigger than Baidu buzz,' a source said. 'They will not be your typical deals because they have sexy backers.'

The most likely listing place is New York for its size and liquidity.

Baidu is the largest Chinese search engine. Its share price shot up more than four times on its first day of trading on the Nasdaq in 2005. It currently trades at 13 times its initial offering price.

A spokesperson for Oak Pacific said the company and its subsidiaries had no listing plans at the moment, but did not rule out going public in the future.

In April, Oak Pacific got an investment of US$430 million from Softbank, SBI and Joho Capital for a 35 per cent stake. Earlier investors included General Atlantic, DCM, Technology Crossover Ventures, Accel Partners and Legend Capital.

This could be a pre-offering round of investment and Oak Pacific could go public in the next six to 12 months, sources said.