Chinese smartphone maker, Xiaomi Corp., announced today its cornerstone investors' share subscription. The seven cornerstone investors including the US chipmaker Qualcomm Inc. are allotted an 11.58 percent subscription of the total offering, with a per share price at HK$17.
Xiaomi, which also makes connecting devices, has set a price of HK$17 per share in the Asian financial hub, one of the biggest tech floats in recent years globally.
According to the report that Xiaomi released today, the seven cornerstone investors include Chinese express delivery company SF Express, domestic telecom service provider China Mobile Ltd, US chipmaker Qualcomm Inc., state-backed investment firm CICFH Entertainment and state-run conglomerate China Merchants Group Ltd.
The companies above take up a combined share of 11.58 percent of the total offering, while the rest will be available for institutional investors. As part of its IPO, Xiaomi is selling about 2.18 billion shares, 65 percent of which are primary, as reported by the China Securities Journal in June.
Some business commentators claimed that it is not hard to notice that most of the seven cornerstone investors are Chinese firms, which suggest that this statement reveals a disparity between the opinions of local firms and foreign companies about their assessment of Xiaomi's future financial development.
Besides, other industry insiders obtain the same conclusion from the report released by Xiaomi, this morning. The report states that CICFH Entertainment Opportunity SPC subscribes 88 million shares, CMC Concord subscribes 12 million shares, and the only company from a foreign country Qualcomm Asia Pacific Pte. Ltd subscribes 46million shares, as reported by the Shanghai Securities Journal today.
Xiaomi officially filed for its IPO in the Hong Kong stock exchange in early May. Reports back then had suggested that Xiaomi had been expected to raise up to $10 billion, with an expected valuation of $100 billion, which would have made it China's third largest technology company based on market capitalization.
However, this figure has triggered many disputes, and recent reports indicate that Xiaomi downgraded its expected value to $54.3 billion from $70 billion, which would make it the city's 12th biggest listing based on market capitalization.
The reason for the severe reduction in the company's valuation is due to its decision to delay its share offering in the Chinese mainland until after its Hong Kong IPO.