New Frontier to Raise $230 Million in New York IPO

New Frontier Corp., a fund manager led by two prominent investors that will focus on China’s health care, education and technology sectors, has set the final pricing for its New York IPO in a deal expected to raise $230 million, according to a source with direct knowledge of the situation.

The deal comes amid a broader wave for new listings of China-focused firms in Hong Kong and New York, many of those from the new-economy sectors that New Frontier is targeting for future investment. One of the largest of those will come next week, when smartphone-maker Xiaomi Corp. is expected to raise as much as $6 billion through a listing in Hong Kong.

New Frontier has priced its American depositary shares at $10 each, with plans to sell 23 million, said the source, speaking on condition of anonymity because the information is still private. The shares are scheduled to start trading in New York on Thursday, the source added.

New Frontier is a “newly incorporated blank check company incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses,” according to its preliminary prospectus filed earlier this month. The company’s chairman is Antony Leung, a former Hong Kong financial secretary and prominent local investor in the former British colony. Its CEO is Carl Wu, 34, a former top executive who helped to build up the Asia operations of private equity giant Blackstone.

“While we may pursue a business combination target in any business or industry, we intend to focus our search for a target with operations or prospects in the healthcare, technology or education sectors in China, which we refer to as the Chinese new economy sectors,” the company said in its prospectus.

“We believe that China is entering a new era of economic growth, particularly in the Chinese new economy sectors, which we expect will result in attractive initial business combination opportunities for us. We believe this growth will be driven by private sector expansion, technological innovation, increasing consumption by the middle class, structural economic and policy reforms and demographic changes in China.”

While Xiaomi represents the new generation of homegrown Chinese technology companies New Frontier is targeting, another major group comes from education firms that are taking advantage of internet-based technologies to develop more flexible instruction options. That group has produced a number of new listings in New York over the past year, including the most recent by Puxin Ltd., which raised $120 million and began trading on June 15.

Contact reporter Yang Ge (geyang@caixin.com)