SenseTime plans to keep IPO at US $767 million: sources

HONG KONG Chinese artificial intelligence startup SenseTime Group plans to keep its initial public offering IPO at US $767 million as it considers launching the withdrawn deal early on Monday, four people with direct knowledge of the matter said.

The information is not public, and the people could not be identified.

A spokesman for SenseTime, which withdrew its Hong Kong IPO on Monday after the administration of U.S. President Biden put the company on a blacklist, wouldn't make a statement to Reuters.

The US Treasury added SenseTime to a list of Chinese military-industrial complexes last week, accusing it of having developed a facial recognition programme to determine a target's ethnicity, with a focus on identifying ethnic Uyghurs.

One of the sources said that SenseTime and its advisers were working on Thursday to finalise the cornerstone investor stake in the new IPO.

The first IPO attempt was likely to have the cornerstone stake at US $450 million, but the composition of investors could change, they added.

SenseTime is expected to price the deal by the end of next week and list on the Hong Kong Stock Exchange before December 31.

Two of the sources said that Chinese buyers were likely to take nearly all of the US $317 million worth of stock in the IPO not taken by cornerstone shareholders.

Sources told Reuters that SenseTime had not anticipated the U.S. decision. It came as the bookbuild to raise US $767 million was being finalised.

Sources told Reuters that the company was working to update its prospectus to include the investment ban in its risk factor sections.

They said that SenseTime could raise the same amount as the initial Hong Kong IPO, but they didn't know if it would be approved by the Hong Kong exchange for the amended risk disclosures.

SenseTime planned to sell 1.5 billion shares in a price range of HKUS $3.85 to HK 3.99 each, according to its initial filings.

The deal was relaunched on Thursday, according to Bloomberg News.