China state newspaper's Web unit plans IPO
(Reuters) - People.com.cn, the online news portal run by People's Daily, the mouthpiece of China's Communist Party, aims to list in Shanghai this year, the state-run China Daily reported on Wednesday.
People's Daily Online Co Ltd, which operates People.com.cn, plans to raise about 800 million yuan ($120.8 million) by selling shares on the Shanghai Stock Exchange, the China Daily said, citing an unidentified source.
People's Daily Online aims to sell 40 million yuan-denominated A-shares in Shanghai at 15-20 yuan apiece in the IPO, making it the first news website to go public in the domestic market, the newspaper said.
People's Daily Online is now in the final stage of bringing in strategic investors. It has struck deals with deep-pocketed investors including China Mobile, China Unicom, China Telecom, China Life Insurance and some domestic private equity firms, the China Daily said.
People's Daily will use the IPO proceeds to expand its online services, the report said.
Last month, People's Daily launched its own news search engine Goso.cn to compete with larger rivals such as Baidu Inc in the lucrative online search market.
"We aim to build People.com.cn into an internationally recognized website," Zhang Yannong, president of People's Daily, was quoted as saying by China Daily.
The central government has said it will encourage 10 state-backed news websites, including People.com.cn, Cntv.cn and Xinhuanet.com, to go public as a way to accelerate reform at these companies to achieve greater efficiency and profitability, China Daily said.
People's Daily Online booked a net profit of 22 million yuan in 2009, with a revenue of 190 million yuan from its core business, the report said.
China Daily said top Chinese brokerage Citic Securities will underwrite People's Daily Online IPO.
($1=6.624 Yuan)
(Reporting by Soo Ai Peng; Editing by Jacqueline Wong)
Credit: Reuters (www.reuters.com)
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