CHINA: Shanda in $725m IPO

CHINA: Shanda in $725m IPO

Chinese web giant Shanda is to sell off a 22 per cent share in its online gaming unit next week, as part of an IPO estimated to be worth $725 million.

Shanda Interactive Entertainment Ltd, the parent company of Shanda Games, has agreed to a Nasdaq-listed initial public offering set to price next week.

According to Reuters, Shanda Games set the price range for its $725 million IPO on Monday, estimating it will sell 63 million American depositary shares for $10.50 to $12.50.

Shanda produces popular MMO Legend of Mir and also operates Aion (pictured) in China – the world's largest internet market with more than 300 million users.

After the Shanda Games IPO, Shanda Interactive will still own about 78 percent of its former unit's shares and 97 percent of the voting rights.

Shanda Games has applied to list its American depositary shares on Nasdaq under the symbol "GAME."

Shanda Games' revenue jumped 42.7 percent year-over-year to about $322 million in the six months ended June 30th, with a 65 per cent gross profit margin.

However, some analysts say it is unclear why the company is spinning off its gaming unit, which contributes 95 percent of the overall company's revenue.

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Tags: china , aion , shanda , shanda games

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