China-based video streaming platform iQiyi has hired Goldman Sachs, Credit Suisse and Bank of America, for an IPO that would provide an exit to internet group Baidu, according to International Financing Review.
The flotation is expected to be worth approximately $1bn and take place as soon as the first half of 2018, though neither Baidu nor the three banks have commented on the initial public offering.
The news of iQiyi hiring underwriters follows reports last month that the company, which is majority-owned by Baidu, would seek a valuation of $8bn to $10bn.
Founded in 2010 as Qiyi before rebranding the following year, iQiyi operates an on-demand streaming platform that licenses third-party content from producers such as movie studio Paramount.
The proceeds from the initial public offering are expected to help iQiyi boost its production of original content.
Baidu and private equity firm Providence Equity Partners invested an undisclosed amount in iQiyi in 2010, before Baidu bought a number of Providence’s shares in 2012 to acquire a majority stake.
In October 2014, Baidu provided a reported $100m in additional investment, before smartphone manufacturer Xiaomi and VC firm Shunwei Capital injected a total of $300m a month later.
Baidu returned again in February 2017 to supply $300m for a $1.53bn funding round that also featured IDG Capital, Sequoia Capital and, according to the South China Morning Post, Hillhouse Capital, Everbright-IDG Industrial Fund, Boyu Capital and Run Liang Tai Fund.