Newspaper web portal IPO under scrutiny
Updated: 2012-01-14 09:28
By Gao Yuan (China Daily)
BEIJING - A proposed initial public offering by the People's Daily's online news portal came under the scrutiny of the China Securities Regulatory Commission on Friday.
If the offering is approved, the portal, People.cn Co, is likely to become the first publicly listed State-level news medium.
People.cn plans to raise about 527 million yuan ($84 million) on the Shanghai Stock Exchange, according to a preliminary prospectus posted on the regulatory commission's website.
The People's Daily, one of the country's biggest newspapers by circulation, is the largest shareholder in People.cn. It has 66.01 percent of the portal's equity, according to the prospectus.
In the event of a successful IPO, People.cn plans to invest more in its Internet services, improve its infrastructure and strengthen its news reporting team, Beijing News reported on Friday.
The company is faced with "serious challenges" from sina.com.cn, sohu.com, qq.com and other commercial news websites, the prospectus said.
"The increasing awareness of brands and abundant capital resources have enabled commercial news websites to grow very quickly," it said. "And they could obtain more news content by working with other news media."
People.com.cn, People.cn's chief website, was placed at No 64 in a ranking of China's most-popular websites on Friday, according to data from Chinarank.org.cn, which ranks other websites. Its main competitor, the commercial website sina.com.cn, ranked No 4 on the list and sohu.com came in at No 6.
People.cn is not the only online State-owned media portal that plans to pursue an IPO. As many as 10 similar websites plan to be listed on the Shanghai Stock Exchange, China National Radio reported, citing industry insiders.
They include Xinhua News Agency's xinhuanet.com, and China Central Television's China Network Television (CNTV).
"We do plan to list CNTV, but a timetable for doing that has yet to be announced," said Wang Wenbin, general manager of CNTV. He also said it would be acceptable if the website were not listed this year.
"Central media are expecting to lift their competitive strength through IPOs," said an executive from Xinhuanet.com, the website for the State-level Xinhua news wire, who declined to be named. "The government's decision to strengthen the country's 'soft power' will encourage State-level media to be listed."
China plans to further establish its "soft power" in the next couple of years, according to the country's 12th Five-Year Plan (2011-15). The government has promised to give more support to education, culture and the media.
"They (State-owned media) need to tap capital markets to compete," Vivek Couto, executive-director of a Singapore-based consultant company, Media Partners Asia Ltd, told Bloomberg News on Tuesday.