China's Qihoo 360 soars in NYSE debut
Shares of Qihoo 360 Technology Co Ltd. (QIHU-N) soared in their debut on the New York Stock Exchange Wednesday after China's third most-popular Internet company priced its initial public offering $2 US above the proposed range.
Qihoo 360 said it was China's No. 3 Internet company by user base and the leading provider of Internet and mobile security products. Its 360 Safe Browser is the second most popular in China after Microsoft's Internet Explorer, the company said, citing iResearch.
Qihoo 360's $176 million IPO comes on the heels of a rush of similar Chinese Internet companies in the fourth quarter, such as online video company Youku.com (YOKU-N) and Internet retailer Dangdang (DANG-N).
So far this year, Chinese IPOs have seen little traction as shares of the companies that listed in New York have dropped below their offer prices.
Beijing-based Qihoo 360 and its stockholders planned to sell 12.1 million shares for $10.50 to $12.50 each, but a source with direct knowledge of the IPO plans had told Reuters that the company planned to raise price expectations to a range of $13.50 to $14.50 because of "significant" investor demand.
The source also said venture capital and private equity firms Sequoia Capital, Highland Capital Partners, Trustbridge Partners and CDH Investments had agreed to buy $50 million of the company's shares in a concurrent private placement.
Qihoo 360's revenue increased 78.5 percent to $57.7 million in 2010 from the year before and almost doubled from 2008 to 2009, according to a filing with U.S. regulators.
The company became profitable over 2009, and its net income more than doubled to $8.5 million in 2010. Net income attributable to shareholders on a diluted basis was 5 cents per share in 2010, up from 3 cents in 2009 and compared with a 7-cent loss in 2008.
UBS Investment Bank and Citi led underwriters on the IPO.