EMERGING MARKETS INVESTOR: DR NEWS
By Gordon Platt
China-based Renren, a copycat of Facebook, became the first social networking site anywhere to be listed on an exchange, with a solid debut on the New York Stock Exchange last month.
The Beijing-based company’s American depositary receipts jumped 29% in their first day of trading, extending the winning record of Chinese Internet stocks.
China had more than 450 million Internet users at the end of last year, and the online market in the country is growing very rapidly. Youku, an online video company similar to YouTube, went public last December on the NYSE and soared 161% in its first day of trading. Shares of Dangdang, the Chinese version of Amazon.com, jumped 87% in their NYSE debut in December. On March 30, 2011, Qihoo 360 Technology, which makes China’s second-most-popular Web browser after Internet Explorer, saw its shares more than double in their first day of trading on the NYSE.
Renren had planned to offer more than 53 million ADRs at a price of $9 to $11 each, but it raised the offering price to $14 in the face of strong demand. Including the sale of an additional 8 million ADRs through an overallotment option with underwriters, Renren raised $855 million in its initial public offering. Morgan Stanley, Deutsche Bank and Credit Suisse led the sale.
Meanwhile, 21 Vianet Technology, an Internet data center services provider in China, selected Citi as depository for its Level-3 ADR program on Nasdaq.