China Chip Firm Horizon Robotics Eyes Moving U.S. IPO to Hong Kong
(Bloomberg) -- Chinese artificial intelligence-chip startup Horizon Robotics Inc. is considering shifting its potential U.S. initial public offering to Hong Kong in the wake of Beijing’s increasing scrutiny of overseas listings, according to people familiar with the matter.
The Intel-backed company is working with advisers to look into a possible Hong Kong float as soon as next year, the people said, asking not to be identified as the matter is private. Horizon had been weighing a U.S. listing that could raise as much as $1 billion, people familiar with the matter said in June.
The plans are preliminary and no final decisions on a venue switch have been made, the people added. A representative for Horizon Robotics declined to comment in a call with Bloomberg News.
The flow of Chinese companies going public in the U.S. ground to an abrupt halt after ride-hailing giant Didi Global Inc. was slapped with a regulatory probe and banned from adding new customers just days after its IPO. Beijing has since proposed tightening rules for firms listing overseas as well as requiring a cybersecurity review for firms with data on more than 1 million users.
Beijing-based Horizon is part of a burgeoning market for developers of advanced automotive technologies such as self-driving, as China looks to become a world leader in artificial intelligence chips and software in general. Tensions with the U.S. have also fueled a push to develop crucial technologies domestically.
Horizon Robotics, backed by investors including Hillhouse Capital and Jack Ma’s Yunfeng Capital, is not the only company to change its fundraising plans in the wake of China’s regulatory crackdown. AI driving startup Pony.ai put its U.S. listing plans on hold in the summer and turned instead toward rising funds privately, Bloomberg News reported.
Chinese audio startup Ximalaya Inc. is the first company since Didi to have formally moved its IPO from the U.S. to Hong Kong, as it submitted listing documents last month.
In addition to the increased scrutiny from Beijing, Chinese companies also face a tougher stance from U.S. regulators who have paused approvals of IPOs by mainland firms until they address issues with their disclosures around the risks of investing in Chinese companies.
Founded in 2015, Horizon Robotics makes AI chips for autonomous vehicles and machines. It also makes software customized to these chips, which can be installed in everything from vehicles to smart speakers. Its partners include Volkswagen AG’s Audi, BYD Co., SAIC Motor Corp. and Robert Bosch GmbH, according to its website.
Earlier this year, the startup raised $400 million in a funding round from investors including Yunfeng Capital, Contemporary Amperex Technology Co. Ltd., Baillie Gifford and CITIC Private Equity Funds.
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With assistance from Bloomberg