Electric-scooter maker Ninebot has had its application for an IPO on Shanghai’s Nasdaq-style high tech board passed by the securities regulator, a move that paves the way for Chinese mainland stock markets to pass two significant milestones, reported Caixin.
Ninebot, which owns the Segway scooter brand, will become the first foreign-registered Chinese company with a variable-interest entity (VIE) structure to go public, and the first to sellChinese depositary receipts (CDRs), a new type of share created in 2018 to allow overseas firms to list on a mainland bourse.
The China Securities Regulatory Commission (CSRC) gave the final blessing to the IPO on Tuesday. In a statement on Tuesday, the commission said it agreed to Ninebot’s application which will be valid for 12 months. The company must sell its CDRs strictly in accordance with the approved prospectus and other IPO documents, it said.
The Chinese authorities had barred companies with a VIE structure from listing on the mainland but scrapped the rulefor the STAR Market when it was set up in 2019 in order to attract overseas-listed technology groups back home. Regulators also allow unlisted VIE-structured companies with rapid revenue growth and self-developed cutting-edge technologies to list on the board, hoping they will choose to stay in China rather than conduct an IPO abroad.