On Wednesday, Chinese AI firm SenseTime announced the decision to sell 1.5 billion Class B shares globally, including 150 million Class B shares in Hong Kong, 1.35 billion Class B shares internationally, and another 15% over-allotted shares. SenseTime Class B shares will start trading December 30.
The offering price is set at HK $3.85 per share. After deducting the underwriting commission and other estimated expenses payable for the global offering and assuming that the over-allotment shares are not exercised, the net proceeds from the global offering are estimated to be about HK $5.552 billion ($712 million). If the over-allotment is fully exercised, SenseTime will receive net proceeds worth HK $847 million from the 225 million new Class B shares to be issued.
It is reported that SenseTime has received a total of 36,000 valid applications to subscribe for a total of 778 million Hong Kong Offer Shares, which is equivalent to about 5.18 times the amount currently on offer. The initial Offer Shares under the International Offer have been moderately oversubscribed, representing approximately 1.5 times the total number of Offer Shares available for subscription.
Based on the offer price of HK $3.85 per share and in accordance with the relevant cornerstone investment agreements, cornerstone investors have subscribed for a total of 1,033 million offer shares, totaling HK $3.977 billion.
According to the announcement, SenseTime plans to use about 60% of the net proceeds to enhance research and development capabilities. About 15% will be allocated to invest in emerging business opportunities and improve the adoption rate and penetration rate of products and services in various vertical industries and enterprises at home and abroad. Another 15% will be used to seek strategic investment and acquisition opportunities while another 10% will be used for working capital and general purposes.
The SenseTime IPO has been full of twists and turns.
At the beginning of December this year, SenseTime began the process to IPO in Hong Kong. Only after the final pricing and listing were released did the US Treasury Department announce that SenseTime would be placed on the List of China’s Military-Industrial Complex Enterprises, and its IPO process was forced to be suspended.
On December 13, SenseTime announced that in order to protect the interests of investors, the board of directors of the company decided to adjust the listing process, and it is expected that a supplementary prospectus will be issued. All the application shares will be refunded to all applicants without interest. In addition, SenseTime also stressed that it will continue to promote the completion of its Hong Kong listing.
On December 20, SenseTime restarted its public offering process. The scale of the.issuance and the IPO price range are consistent with those at the time of the IPO planned on December 7, and the changes mainly come from cornerstone investors, account book managers and the exclusion of American investors from the global offering. All nine cornerstone investors are Chinese-funded institutions, and the cornerstone investment scale has further increased from the earlier $450 million to $510 million.