Xiaomi is reportedly set to file for an initial public offering (IPO) in Hong Kong next month in a move that will supposedly put the company's value at between $65 billion and $70 billion, according to new rumors from China. Earlier reports suggested that Xiaomi was considering pursuing an IPO at the New York Stock Exchange but it has now reportedly opted for Hong Kong instead. The new valuation is less than what Xiaomi was previously said to have been targeting and the IPO itself was initially expected in the second half of 2018. Earlier this year, it was reported that the Chinese original equipment manufacturer was seeking a $100 billion valuation.
The Chinese phone maker's upcoming IPO is expected to be led by Morgan Stanley, Goldman Sachs, and several other international finance firms, according to previous reports. Xiaomi picked these financial institutions last January, with Deutsche Bank and Credit Suisse Group being on the list of the company's banking partners as well. It is understood that more financial institutions are involved in the IPO plan, though their names have yet to be disclosed. However, Xiaomi has yet to select even a single partner from its home country of China. The participation of such big financial institutions in Xiaomi's planned IPO indicates that the company's ambition to go public will adopt a traditional approach which relies on underwriters in an effort to give assurance to prospective investors. While the move by no means guarantees immediate growth for Xiaomi, the IPO plan is expected to help beef up the stability of the company's future stock.
Rumors about Xiaomi's IPO plan first surfaced last year despite its long history of denying such ambitions, with its Chief Financial Officer Shou Zi Chew having previously indicated that a market listing is not the company's priority due to the positive state of its finances. This February, Huami Corporation, the sole manufacturer of Xiaomi's Mi Band wearables, held its IPO on NYSE and raised approximately $110 million in cash.