"HKEX has been well prepared for mainland IPOs and second listing for over years.
#CHINABASED LINKDOC US FREE#
If the US regulator indeed suspends the Chinese IPOs it will be a big setback for US capital markets, meaning they will no longer live up to the name of an international free market without Chinese participation, Dong Dengxin, director of the Finance and Securities Institute of Wuhan University, told the Global Times on Friday.ĭong noted that there won't be a big impact on such companies as they can choose to be listed on the Hong Kong Stock Exchanges which can offer complete substitution for NASDAQ and New York Stock Exchange. The Chinese securities regulator mentioned it is open to let companies choose where to go public and supports them in making choices based on their own development needs, the official Xinhua News Agency said in a much-quoted commentary late Wednesday. The new curbs set on Chinese IPO hopefuls, reputed by market observers as politically motivated, contrast with China's pledge to continue its market opening while taking an open approach to its businesses' choices of listing destinations. NetEase plunged by over 10 percent, Bilibili fell by 7 percent while Alibaba slid 3 percent. Shares of US-listed Chinese stocks opened lower on Friday trading. In an earlier report on Friday, Reuters disclosed that the US securities regulator will halt processing Chinese company listings. In a Friday statement, SEC said IPO filings by issuers associated with China-based operating firms won't be declared effective unless they provide certain disclosures.Ĭompanies affected by the new rule are China-based operating companies structured as Variable Interest Entities (VIEs). Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.IPOs by companies with operations in China in the US stock markets is likely to stall over the remaining months of the year, Chinese industry insiders and securities experts said on Friday, after the US Securities and Exchange Commission (SEC) said such IPO hopefuls need to provide additional risk disclosures on Friday. “The new rules may impose long waiting periods on any companies hoping to list abroad which will hit investor sentiment, depress valuations for IPOs in the US and make it more difficult to raise funds overseas,” he said.
“For companies applying for a US listing, they may have to wait for further clarification, stricter scrutiny and pre-approval from different regulators and authorities,” said Bruce Pang, macro & strategy research head at China Renaissance Securities. LinkDoc’s decision to suspend its US$211 million IPO, first reported by Reuters, is likely to be followed by others, analysts said, although they noted that US listings were not barred per se. That was soon followed with an order for Didi’s app be removed from app stores.īeijing also stated on Tuesday, July 6, it would strengthen supervision of all Chinese firms listed offshore, a sweeping regulatory shift that triggered a sell-off in US-listed Chinese stocks. It is the first Chinese firm known to have pulled back from IPO plans since China’s cybersecurity regulator toughened its approach to oversight last week with an investigation into ride-hailing giant Didi just two days after its New York debut. Chinese medical data group LinkDoc Technology has shelved plans for an IPO in the United States due to Beijing’s clampdown on overseas listings by domestic firms, according to sources with direct knowledge of the matter.
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