Cloud Village postpones Hong Hong debut amid Chinese market downturns. The music streaming subsidiary of NetEase surprised this last session by confirming the delay of its IPO in Hong Kong. Cloud Village was slated to debut on the floor to fetch about $ 1 billion.
As they emphasize from Bloomberg , this IPO was going to be one of the largest in Hong Kong by a technology company this year and the delay is clearly due to waiting for a better moment for the Chinese market, after the falls seen.
From the agency, they point out that this sudden setback could be influenced by an increasingly broad campaign by Beijing to curb the technology and Internet sector, which during these last sessions experienced massive sales in the Chinese technology giants.
Regulatory pressure from China wiped out more than $ 1 trillion of the market value of Chinese stocks . Since the beginning of July, the Hang Seng Tech index in Hong Kong has lost 18%, while the Nasdaq Golden Dragon index, which tracks Chinese companies listed in the United States, most of them technological, has fallen by 24 % in the same period.
NetEase has not been spared from the sales, especially after Chinese state media began criticizing the video game industry. After the falls, however, yesterday the gaming company’s Hong Kong shares trimmed recent losses, advancing as much as 4.7% in Monday’s session.
Something that also happened with the NetEase ADR listed in the United States, which managed to rise more than 6% in the middle of the session .
Beyond these canceled exits in Hong Kong due to the regulatory climate, the Chinese government’s efforts have resulted in most, if not all, planned U.S. IPOs by mainland companies being put on hold. Beijing last month proposed new rules that increase its oversight of overseas IPOs, in a move aimed at safeguarding data security.
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