Several Chinese companies, including Beijing Smart Walnut Education Technology Co., are weighing the option of launching initial public offerings (IPOs) in the United States, despite ongoing market instability and rising tensions between Washington and Beijing. People familiar with the matter confirmed that Walnut Coding, as it is commonly known, could look to raise around $100 million through a US listing.
Other companies exploring similar IPO possibilities include Shenzhen Cloudsky Technologies Co., a provider of computing infrastructure, and software service platforms Zaihui and Zhonghe Group. Each of these firms is also reportedly considering raising approximately $100 million in their potential offerings.
Despite the uncertainty surrounding the US market, including the looming threat of potential delistings, the IPO plans are still under consideration. Recently, US Treasury Secretary Scott Bessent remarked that “all options are on the table” in relation to actions against Chinese firms, especially amid trade negotiations. This follows a significant 23% drop in the Nasdaq Golden Dragon China Index since mid-March, compared to a 9% decline in the S&P 500 during the same period.
No final decisions have been made regarding these IPOs, and the companies could ultimately choose not to proceed with their listings. Representatives for Walnut Coding, which is backed by major private equity firms including KKR & Co. and Hillhouse Investment, declined to comment. Similarly, Zaihui, Zhonghe, and Cloudsky have not responded to requests for further information.
The number of Chinese companies seeking US listings has decreased since the controversial IPO of Didi Global Inc. in 2021, which led to a regulatory crackdown on China’s internet sector and a forced delisting of the ride-hailing giant.
Despite these challenges, the US stock market remains attractive to Chinese companies due to its high liquidity, and US-based investment banks stand to gain higher fees from share sales compared to other markets such as Hong Kong. Recently, Chagee Holdings Ltd., a tea chain, raised $411 million in its US IPO, surpassing its initial price expectations and seeing a 16% surge in its stock price on debut—an example of resilience amid geopolitical and market volatility.
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