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Date: July 13, 2005
Copyright: Reuters
HONG KONG, July 13 (Reuters) - The IPO by Focus Media Holding Ltd. (FMCN.O: Quote, Profile, Research) raised $171.7 million after the Chinese advertising firm priced its shares above their indicative range, underwriter Goldman Sachs said on Wednesday, reflecting keen investor demand for access to China's fast-growing ad market.
Shares in Shanghai-based Focus Media were set to begin trading later on Wednesday on the Nasdaq in the United States.
Focus Media, whose investors include top private equity firms 3i Group (III.L: Quote, Profile, Research), Draper Fisher Jurvetson and Softbank Corp. (9984.T: Quote, Profile, Research), operates an advertising network that uses television screens placed in office buildings and other commercial sites in 22 cities across China as of March.
It said its number of commercial locations had grown to 8,866 as of March from 754 in January 2004.
The initial public offering of 10.1 million American Depositary Shares (ADS) was priced at $17 each, above an indicative range of $14 to $16 each, Goldman sachs (GS.N: Quote, Profile, Research) said.
Existing shareholders sold 3.1 million of the ADS in the offering.
For the three months through March, Focus generated net income of $2.6 million on sales of $9.6 million, compared with net income of $713,000 on revenue of $3.1 million in the same quarter a year earlier.
China is one of the world's fastest growing advertising markets, with advertising spending of $7.7 billion in 2003, which is expected to grow at an average rate of 16.3 percent per year through 2007, Focus Media said, citing data from ZenithOptimedia.
Rival Chinese advertising firm Target Media, which is backed by the Carlyle Group private equity firm, also plans an overseas IPO this year or next worth about $150 million.
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