Bitcoin Mining Equipment Maker Canaan Files for $1 Billion IPO

(Bloomberg) — Canaan Inc., the world’s second-biggest maker of bitcoin mining , submitted a list utility to the Hong Kong inventory alternate.

Morgan Stanley, Deutsche Financial institution AG, Credit score Suisse Group AG and CMB Worldwide Capital Ltd. are joint sponsors of the proposed providing, in line with a preliminary prospectus posted late Tuesday. Bloomberg Information reported earlier Tuesday that Canaan had filed for an IPO that would elevate about $1 billion. The submitting didn’t say how a lot Canaan will search.

Canaan goals to start out buying and selling as quickly as July, an individual with information of the matter mentioned, asking to not be recognized as a result of the data is non-public. The corporate, based mostly within the japanese Chinese language metropolis of Hangzhou, had income of 1.three billion yuan ($205 million) final 12 months. Internet earnings surged greater than sixfold to 361 million yuan, in line with Tuesday’s submitting.

An inventory of Canaan can be the primary Hong Kong IPO from the cryptocurrency business. The corporate has about 15 p.c of the worldwide market for bitcoin mining chips and pc gear, trailing Chinese language rival Bitmain, in line with a February report from Sanford C. Bernstein & Co.

Canaan, based in 2013, sells pc gear beneath the “Avalon” model with quick, custom-made chips that win digital cash by fixing advanced math issues. The corporate’s typically results in distant locales housing giant mining swimming pools that rely upon low-cost electrical energy, Co-Chairman Jianping Kong mentioned in an April interview.

© Bloomberg
Canaan Inventive Co. Co-Chairmans Jianping Kong And Ng Zhang Interview

Canaan co-Chairman Jianping Kong, proper, with founder and CEO N.G. Zhang in April.

The corporate additionally introduced final 12 months it was growing devoted chips for use in synthetic intelligence purposes.

No last choices have been made, and particulars of the providing might change, the folks mentioned. Kong declined to touch upon particulars of the IPO plans.

Canaan was getting ready final 12 months to listing on China’s Nationwide Equities Alternate and Quotations, an over-the-counter market generally known as the New Third Board, earlier than opting to pursue a Hong Kong IPO.

In 2016, electrical gear producer Shandong Luyitong Clever Electrical Plc sought to accumulate Canaan, in line with filings on the time. “Nice uncertainties” surrounding China’s securities setting and regulatory insurance policies torpedoed the deal, Shandong Luyitong mentioned in a press release on the time.

The ASIC-based blockchain market in China grew to 7.three billion yuan final 12 months from 50 million yuan in 2013, Canaan mentioned within the submitting, and advisor Frost & Sullivan forecasts that it’ll attain 28.6 billion yuan by 2020.

To contact the reporters on this story: Crystal Tse in Hong Kong at ctse44@bloomberg.internet;Blake Schmidt in Hong Kong at bschmidt16@bloomberg.internet

To contact the editors accountable for this story: Ben Scent at bscent@bloomberg.internet, ;Pierre Paulden at ppaulden@bloomberg.internet, Marcus Wright

©2018 Bloomberg L.P.

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