Displaying items by tag: Goldman Sachs
Chinese electronics and software company Xiaomi has reportedly signed on bankers to support an expected initial public offering (IPO) which could value the company at $100 billion, Bloomberg said. Goldman Sachs and Morgan Stanely have been selected by Xiaomi, with Credit Suisse and Deutsche Bank playing a role, the report speculates.
Xiaomi experienced a weak 2016 only to return to much stronger growth in 2017. Therefore, there is significant interest in the company going public. According to reports, the Chinese company is set to smash its annual target, with strong profitability. Xiaomi’s value was proposed at $50 billion in earlier reports, but now it’s being valued at $100 billion.
Xiaomi still faces challenges, however, despite its strong growth. The company will need to enter new additional markets if its smartphone segment is to keep growing, because competition in its home country of China is heavy. Xiaomi has succeeded in establishing itself in markets like India, but expanding further will not be an easy process for the company.
Working with partners and building a strong hardware ecosystem resulted in Xiaomi’s Mi smartphone brand gaining strength in the consumer space, the Bloomberg report said. It adds that Xiaomi’s strength in software has set it apart from other Chinese vendors.
Hong Kong-based PCCW, the holding company of HKT Group Holdings Limited, the information and communications technology company, reportedly plans to raise HK$8.53 billion ($1.09 billion) through the sale of 840.7 million share stapled units in subsidiary HKT.
According to reports, PCCW plans to use the proceeds from the sale to pay back debt, make further investments in media and IT services, business and other general corporate purposes.
The company is said to be expanding its reach into Asia, including a plan to extend its OTT video service Via into Thailand, and continue to expand into eastern China. With the proceeds from the sale, PCC would be in a better position financially to pursue these ambitions.
Managing the planned transaction is Goldman Sachs. The sale would represent an approximate 11.1 percent stake in HKT, and dilute PCCW’s share in the operator to around 51.97 percent. The transaction has a placing price of HK$10.15 per unit.
When the planned transaction was announced, PCCW’s shares dropped 5.97 percent to HK$4.57 at close of trading on Monday, February 13. Meanwhile, HKT saw its share fall 7.4 percent to HK$10.26.
If the transaction goes through, it will mark the second large recent divestment by PCCW, following the sale of Transvision (the owner of mobile broadband licensee UK Broadband) to Three UK for $375.9 million earlier this month.