Xiaomi offers itself as ‘new species’ as it allays doubts to justify US$6.1 billion stock sale
CEO Lei Jun says the smartphone giant is a “new species” of company because it’s a hardware maker that also makes money from internet services
Lei Jun, the entrepreneur who took a mere seven years to create the world’s fourth-largest phone maker, put on a brave face as he presented the largest global stock offer of 2018 to retail investors, even as he pushed back against the Chinese government’s strong-arm tactics to split his fundraising.
Xiaomi, the Chinese smartphone maker that went from start-up to 100 billion yuan (US$16 billion) in global sales in seven years, represents a “new species” of company in the technology industry because it’s a hardware maker that makes money from internet services, Lei said during a 90-minute presentation at the Four Seasons Hotel in Hong Kong.
“Xiaomi is a new species, in a class of its own,” Lei said in Mandarin Chinese. “Rather than explaining whether it’s a hardware maker or an internet firm, I would say Xiaomi is an all-rounded company that can do well in all three aspects of hardware, e-commerce and retail, and internet services.”
The identity of the company, whose name means millet in Chinese, is the crux in Lei’s plan for tapping the global markets for capital, and for turning his Beijing-based company into a global player.
Xiaomi will offer 2.179 billion shares at between HK$17 and HK$22 billion each on June 25, raising up to HK$47.95 billion (US$6.1 billion) in Hong Kong, valuing the entire company at between US$54 billion and US$70 billion. The world’s biggest IPO this year will begin trading on July 9, according to a press release.