Video streaming giant iQiyi said to be mulling IPO in the US
A flotation of China’s leading video streaming platform, a subsidiary of internet search giant Baidu, could value the company at as much as US$10 billion
China’s leading video streaming platform iQiyi, a subsidiary of internet search giant Baidu, is said to be mulling an initial public offering (IPO) in the US that could value the company at as much as US$10 billion.
The Netflix-like video streaming giant is meeting potential underwriters with a view to a 2018 listing, according to Bloomberg, citing sources close to the matter.
Speculation has been growing for months that iQiyi was seeking an IPO in either Hong Kong or the US.
Both Baidu and iQiyi declined to comment on the potential IPO plan.
The acclaimed video streaming platform raised US$1.5 billion in February with the issue of convertible notes to a group of investors including Baidu, which has held a majority stake in the company since 2012, as part of a concerted push into the country’s booming entertainment market.
“Video streaming businesses in China are cash-burning, as bandwidth costs and content licensing fees rise each year,” said Xiong Hui, an analyst with independent research firm iResearch, adding that competition plays a major part, too, forcing platforms to provide not only a larger pool of movies and TV content, but also high-quality ones, as good as 1080p or even Blu-ray.