Chindata, iHuman join string of Chinese companies fundraising in US
- Bain Capital-backed Chindata Group seeks to raise up to US$600 million, person familiar with the matter says
- Chinese companies are raising bigger deals despite rising US-China tensions
Chindata and iHuman have both filed for initial public offerings on the New York Stock Exchange this week, joining a string of other Chinese companies fundraising in the US despite threats from Washington to decouple the world’s two biggest economies.
Bain Capital-backed data centre solution provider Chindata filed Tuesday for an IPO, seeking to raise between US$500 million to US$600 million, according to a person familiar with the transaction. iHuman, a provider of e-learning apps for children, has also filed to list its American depositary shares on the exchange, according to its preliminary filing document.
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The IPOs of Chindata and iHuman come amid a slide in the Nasdaq Composite, which suffered its biggest drop since the March sell-off, ending Tuesday with three-straight days of decline.
The index was down 10 per cent from its record high reached last Wednesday. An extended correction in US tech stocks might put investors’ strong appetite for their Chinese peers seen so-far this year to the test.
This year’s strong fundraising momentum by Chinese firms has come despite US-China relations hitting a new low, as US President Donald Trump has this week ratcheted up tensions by threatening to decouple the US economy from that of China.
For Chindata Group, underwriters for the deal include Morgan Stanley, UBS, Citi and China Renaissance. Bain Capital owns about 57 per cent stake in the company, according to its preliminary document filed with the US securities regulator.
The Beijing-based company operates data centres in China, Malaysia and is building another one in India.
For the six months ended June, Chindata’s net loss was 59.4 million yuan (US$8.7 million), up from 58.1 million yuan in the same period a year ago.
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iHuman, a provider of learning apps targeting children aged between three and eight, has also filed for an initial public offering on the New York Stock Exchange overnight. Underwriters for the deal are Citi and Credit Suisse.
iHuman claims a user base of 10.3 million average monthly active users in the second quarter this year, and 1.4 million paying users, data from its US filing shows. Its apps offer content to children in the fields language, maths, literacy and reading.
The company plans to use the net proceeds raised on expanding its product offerings both within China and overseas, and on improving its technology infrastructure.
For the six months ended June 30, iHuman reported a net income of 5.6 million yuan, reversing a net loss of 271.8 million yuan in the same period a year ago.
China’s content-based complementary childhood education market is forecast to grow to 460.9 billion yuan in revenue in 2024, from 111.4 billion yuan, representing a compound annual growth rate of 32.8 per cent, according to consultancy Frost & Sullivan.
(Corrects story throughout to change company’s name to Chindata, from Chinadata)
