Guess what? China’s regulatory crackdown strikes again. This time, Syngenta, a leading agricultural science and technology provider, saw its IPO being blocked in the pipeline due to “outdated financial data.” Syngenta was set to become one of the world’s biggest IPOs of the year, with an estimated valuation of $10b.
Another victim was the social media and e-commerce platform Little Red Book (aka Xiaohongshu), aiming to raise more than $500m from its IPO. Little Red Book has more than 100 million monthly active users, with about 70% of them born in the 1990s or later. China’s proposed new regulations would require all tech companies with more than 1 million active users to undergo a cybersecurity review before going public. Little Red Book is backed by Tencent and Alibaba (definitely not newbies to China’s crackdowns).
why it matters
Little Red Book and Syngenta weren't the only companies affected by China's blow. Up to 57 other companies saw their IPOs on the Shanghai Exchange being blocked. Overall, these companies were looking to raise $21b.