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Chinese AI firm iFlyTek’s healthcare unit plans Hong Kong IPO, sparking hopes that spin-offs fuel a turnaround in slumping listings market

  • iFlyTek, which currently holds a 52.47 per cent stake in iFlyHealth, will maintain control after its spin-off and listing
  • Founded in 2016, iFlyHealth utilises speech recognition, speech synthesis and natural language understanding technologies in the medical field

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iFlyTek says the initial size of an iFlyHealth listing will not be more than 20.0899 million shares, with an overallotment option of up to 15 per cent. Photo: Weibo
Aileen Chuang

Chinese artificial intelligence (AI) company iFlyTek said it plans to spin off its healthcare services subsidiary, iFlyHealth, with a listing in Hong Kong.

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Shenzhen-listed iFlyTek said the initial size of an iFlyHealth listing will not be more than 20.0899 million shares, with an overallotment option of up to 15 per cent. The total number of shares is proposed to not exceed 23.1034 million.

The move will allow iFlyHealth to obtain financing through the capital markets in Hong Kong, which will help it to maintain its leading role in the field of medical AI and increase its international influence, iFlyTek said in a statement late on Tuesday.

iFlyTek, which currently holds a 52.47 per cent stake in iFlyHealth, will maintain control after its spin-off and listing. iFlyTek’s shares declined by as much as 3.4 per cent to 38.78 yuan (US$5.4) on Wednesday.

The potential initial public offering (IPO) could provide a boost to Hong Kong, which has seen a slump in listings. The city raised only a two-decade low of HK$46.3 billion (US$5.92 billion) from local and global investors last year.

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It is hoped that growing opportunities for spin-off listings by Chinese firms and positive sentiment among investors in AI-related sectors will help the city’s stock market get out of the woods. KPMG, for instance, forecast on Tuesday that new stock offerings in Hong Kong could double to HK$100 billion this year.

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