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Chinese High-Tech Start-up Eyes SESDAQ Listing
To raise money for business expansion, a local high-tech start-up plans to go public on Singapore's SESDAQ, bypassing the more traditional NASDAQ and Hong Kong growth enterprises market.
The Shanghai-based Bitsoft Co Ltd would be the first Chinese high-tech firm to be listed on SESDAQ, a second board market whose requirements are less stringent than the country's main board stock market.
About 60 companies are now listed, with a total market value of about US$2 billion, down from the main board's 300 firms valued at US$270 billion.
"Currently, we have already shown strong interest and made informal applications to the China Securities Regulatory Commission, the regulatory authorities of China's stock market," company general manager Fu Zhangqiang said Monday.
The commission requires that Chinese firms seeking overseas listings first get its approval before getting go-aheads from security authorities in the other country.
Fu, a 26-year-old Fujian native, said Bitsoft could be listed within a year and that the company has formed a group charged with bringing the business in line with market requirements.
Fu said that because he expects few other software companies on SESDAQ "our listing will arouse huge investor interest.
"But US investors are not now very enthusiastic about investing in China-oriented high-tech firms, so it is not the right time to eye the western market," Fu said, adding that Hong Kong's market is too competitive.
Starting with Beida Jade Bird's listing on Hong Kong's second board, eight Chinese high-tech firms went public on the growth enterprises market. Fudan Microelectronics Co was listed this month.
The company, established in December 1998, has grown fast, with turnover exceeding 7 million yuan (US$845,000) last year.
Its flagship product is a series of software products for law firms. Bitsoft wants to sell overseas later.
"Our goal is to take at least 50 per cent of the legal software market share within two to three years," said Fu, who says his company now controls only a small section of the market. He said the software sells in Shanghai, Beijing, Guangdong Province and Fujian Province.
To prepare for SESDAQ, the company is negotiating with a number of venture capitalists, Chinese government-funded firms and private companies.
The company plans to raise 20 to 30 million yuan (US$2.41 million to US$3.62 million) to swap no less than 30 per cent of the company's total shares through venture capital.
"So far, we are in hot discussions with a number of fund managers, and we will choose the best and most suitable one," said Fu.
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