One of the largest online video streaming website of China, iQiyi has pitched an estimated $2.4 billion in an initial public offering (IPO). iQiyi, owned by Baidu, is one of the largest internet companies ranking 4th in Alexa Internet rankings.
As per the reports from U.S. Securities and Exchange Commission, the video streaming site is ready to give 125 million American depositary shares ranging from $17 to $19 in Nasdaq stock market.
This move has been made against its rival competitor, Alibaba’s service Youku Tudou Inc, in the Chinese market for gaining financial upper hand over it. Currently, iQiyi has 400 million users.
The video portal giant strategically divided its earnings in such a way that, half of it will be utilized in developing, expanding and refining its quality of content whereas 10% will be spent on boosting its digital technology. The remaining revenue will be directed towards corporate extension.
Chief Content Officer of iQiyi, Wang Xiaohui commented, “The next phase of Internet video is the upgrading of content, and the realization of content creation requires more people, especially the new force.”
In accordance with U.S securities Act of 1933, iQiyi has drafted a proposal of IPO offerings. A total of its 80.2% shares, similar to Netflix- like video platform are presently owned by Baidu.
Market statistics suggested that last year, iQuy’s earnings skyrocketed to 17.38 billion yuan ($2.7 billion), around 55% increase than 2016.
Another Chinese online video streaming competitor, Bilibili has also joined the competition and intends to gain profit up to $525 million. Its depositary shares will range from $10.50 to $12.50, each including an option to sell 6.3 million shares.
Chinese IT companies have always targeted New York for their global expansion. The city offers large number of shareholders, depositors having accommodating policy listings options and space for financial growth.