Weibo seeking $540m in float

Social media service Weibo, often called “the Twitter of China”, has unveiled estimated terms for an initial public offering.

Social media service Weibo, often called “the Twitter of China”, has unveiled estimated terms for an initial public offering of about 20 million American depositary shares.

Weibo’s owner, Sina Corporation, said last month it was taking the company public with a plan to raise up to $US500 million ($540m) in an IPO.

The move to go public came four months after Twitter’s IPO.

In a filing with the US Securities and Exchange Commission, Weibo estimated ADRs would price between $US17 and $US19 apiece.

Weibo estimates it will receive net proceeds from the IPO — and a concurrent private placement from e-commerce giant Alibaba — of about $US377.2m, or up to nearly $US429m if ­under­writers purchase additional ADRs.

Those estimates were based on the assumption that the IPO priced at the mid-point of the range, Weibo said.

Weibo intends to use the proceeds to enhance its brand recognition, retain talented employees by providing equity incentives, and obtain additional capital.

It also intends to use about $US250m to repay loans owed to Sina.

Weibo’s revenue nearly doubled last year to $US188.3m, but the company also lost $US38.1m. In terms of users, Weibo is about half the size of Twitter.

The ADRs are expected to be listed on the Nasdaq Global Select Market under the symbol WB.

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