ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
IPO

China's SenseTime prepares for Hong Kong IPO despite tech regulations and US blacklist

The logo of artificial intelligence startup SenseTime is seen at its office in Hong Kong, China Aug. 18.   © Reuters

HONG KONG (Reuters) -- China's artificial intelligence start up SenseTime Group has identified the mainland's tightening technology regulatory regime as a key risk for investors in its proposed Hong Kong initial public offering (IPO), according to its filings.

SenseTime, which is also blacklisted in the U.S, lodged its preliminary filings Friday with the Hong Kong Exchange and Clearing Ltd, operator of the city's stock exchange.

It did not identify a raising size but Reuters reported on Aug 19 the firm is aiming to raise up to $2 billion.

SenseTime declined to comment on the size of the deal.

The company provides technology-based applications including, facial recognition and video analysing and autonomous driving.

In the filings, SenseTime said China's changing regulations, especially towards sensitive data handling, could impact its business but it was unable to quantify the effects of the new rules.

"We cannot predict the impact of the draft measures, if any, at this stage, and we will closely monitor and assess any development in the rule-making process ... it remains uncertain whether the proposed measures will be applicable to our business," it said.

China announced on Aug 20 new rules governing the better storage of users data which has instructed companies not to mismanage or misuse the data.

SenseTime was among eight Chinese tech companies placed on the U.S. Entity List in 2019 amid trade tensions between Beijing and Washington. The U.S. alleges the companies played a role in human rights abuses against Muslim minority groups in China.

SenseTime said at the time that it strongly opposed the U.S. ban and would work with relevant authorities to resolve the situation.

In the filings it said: "If our subsidiary remains on the Entity List on a prolonged basis, we may not be able to compete effectively in certain business lines, and our business, results of operations and financial condition could be materially and adversely affected."

SenseTime had considered listing on the tech-focused STAR Market in Shanghai, but shifted to Hong Kong as its application for STAR was progressing slowly, Reuters has previously reported.

SenseTime has not identified when it will list but applications to the Hong Kong Stock Exchange typically take three to four months from its first filings.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more