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Bilibili debuts in Hong Kong at a discount, second IPO to fizzle in a week, as CEO blames ‘black swan’ slump in US-listed Chinese stocks
- Stock ended debut on strong footing after dipping as much as 6.8 per cent below its IPO price of HK$808 each
- CEO Chen blamed ‘black swan’ slump in US-listed Chinese stocks, recalls Bilibili’s flop on Nasdaq and says no one will remember this in 10 years’ time
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Bilibili, which operates China’s version of YouTube, handed investors a 1 per cent loss on the first day of trading, after completing a US$2.6 billion secondary offering in Hong Kong. A slump in New York trading amid a major dumping spree and worsening US-China ties hurt sentiment.
Chairman and chief executive officer Chen Rui, who controls 43.7 per cent of voting power, cited a US law to compel foreign companies to grant access to their financial audits as “black swan” event, which triggered a record slump in US-listed Chinese stocks last week shortly after the company concluded its stock offering on March 23.
“The general situation of the stock market is relatively bad,” Chen said during an online media briefing on Monday. After Bilibili priced its IPO, “US-listed Chinese stocks have experienced the biggest drop in recent years, which should be regarded as a black swan event.”
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The Shanghai-based company chose to list in US three years ago because it thought US was “an open market,” Chen said. The firm is now reviewing the SEC document which requires accounting firms to let US regulators review the audits of overseas companies, he added.
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Global brands face backlash in China for rejecting Xinjiang cotton
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An S&P Index of 50 US-listed Chinese stocks slumped 11.7 per cent last week, according to Bloomberg data, the steepest drop on record since its inception in June 2015. Baidu, Pinduoduo, JD.com, NIO Inc and Alibaba Group Holding (the owner of this newspaper) are the five biggest index members.
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Bilibili sold 25 million shares at HK$808 each to collect HK$19.9 billion in net proceeds on March 23, joining US-listed Chinese companies like Baidu, Autohome and Yidu Tech in secondary listing in the city this year. Bilibili’s offering was priced off its American depositary shares of US$105.99 on Nasdaq.
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