China-based microblogging network Sina Weibo has set the range for its forthcoming initial public offering between $17.00 and $19.00, and could potentially secure up to $437m when it floats.
Weibo plans to issue 20 million American depositary shares (ADSs), each valued equally to one ordinary share, and underwriters Goldman Sachs (Asia), Credit Suisse Securities (USA), Morgan Stanley & Co. International, Piper Jaffray & Co. and China Renaissance Securities (Hong Kong) will have the 30-day option to buy a further 3 million.
E-commerce company Alibaba, which could raise up to $15bn from its own US-based flotation later this year, currently holds 43.9 million shares in Weibo, equating to a 19.3% share in the company.
Alibaba plans to buy more than 24 million shares from Weibo’s parent company, China-based internet company Sina, as well as just over 6 million shares issued through the offering to increase its share to 32%. Sina’s 77.6% share will be diluted to 56.9%.
A total of $250m of the proceeds will go towards repaying debt owed to Sina, and additional capital will be used to buy back options held by people that provided services to Weibo.