Today’s awaited IPO of Xinhua Finance Media Ltd. (XFML-NASDAQ) is set to open for trading today. The company raised almost $300 million in the IPO, which was 23.07 million ADR’s at $13.00 per share.
This one is an IPO that we actually think has great long-term prospects for those that can take a true long-term approach. This would have been given a better reception. Yesterday’s Clearwire (CLWR-NASDAQ) IPO that turned into a "busted IPO" on the first day didn’t help ANY IPO for today and for the immediate future. The fact that the Shanghai Stock Exchange air-letting session last week was perhaps one of the two or three issues to blame for the US meltdown we saw didn’t help either.
If you are a believer in the long-term of China and media there and even more importantly "for outsiders peering into China" then the fact that this one was muted just represents a better opportunity. If you are a nay-sayer, then you just got more ammo as to why this was a mid-range deal. Our stance on this one has been pretty clear and the company has demonstrated a significant past to get to where it is now.
NASDAQ has given an initial quote indication time for this one of 10:45 AM EST, and has an indicated "release" time for trading to open at 11:00 AM EST. SourceFire (FIRE-NASDAQ) is one that opens at 10:40 AM EST, and while the companies are about as unrelated as can be you always have to take the IPO to IPO comparison. We don’t make the rules, they just are what they are. If something bad happens on the FIRE IPO, that too may take out some wind from Xinhua’s initial followers.
Jon C. Ogg
March 9, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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