Quick Take: Foxconn Unit to Beef Up Production With $4.3 Billion in IPO Cash
Foxconn Industrial Internet Co. Ltd., an internet-focused unit of Taiwan’s Foxconn, said (link in Chinese) Monday it will invest 27.3 billion yuan ($4.31 billion) in production upgrades after its upcoming Shanghai listing.
The funds will be used to improve the firm’s smartphone production and also be spent on the company’s 5G and cloud computing projects, the statement said. However, it did not reveal the total amount of money the company aims to raise through its initial public offering (IPO) of no more than 1.97 billion shares, or 10% of total shares.
The company will start taking bids for shares on May 24, at a price to be determined. The actual listing day traditionally follows in a week or two.
Foxconn Industrial Internet posted a net profit of 15.9 billion yuan last year, up by 10.4% from a year earlier.
Foxconn Industrial Internet’s Shanghai IPO comes at a time when Chinese regulators are encouraging more new-economy companies to go public, making it easier for companies from the high-tech and emerging strategic sectors to raise funds on the domestic stock market.
It took the company only 36 days, the shortest-ever period, to get the securities regulator’s listing approval in March. However, it took 54 days, a relatively long time, for Foxconn to actually receive the approval document, which it did on Friday. In a rare move, the regulator didn’t mention how much Foxconn wants to raise.
An investment banker told Caixin that the delay may be due to the fact that Foxconn is seeking a very large amount of capital.
Contact reporter Coco Feng (firstname.lastname@example.org)
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