Chinese cosmetics retailer Jumei jumps on IPO US bandwagon
The Beijing-based retailer has previously raised money from U.S. and European venture-capital firms, including Sequoia Capital.
According to the Wall Street Journal, Jumei is now working with Credit Suisse and Goldman Sachs.
The IPO might raise around $600 million, at a valuation above $3 billion, and is expected to come later this year, the publication reported.
The U.S. market offers Chinese companies options not available in Hong Kong, such as dual-class structures and the ability to list without having turned a profit.
In 2012, Jumei generated $400 million in revenue and its then CEO Leo Chen reckoned the brand could exceed $1 billion in revenue by 2013.
Investment in Chinese firms on the up
Reuters reports about 30 firms could list in the US this year, the figures are the biggest since 2010, despite there being an issue between Beijing and Washington.
The country's online transaction volume jumped 42% last year to $305 billion and is expected to almost double in size by 2016, interest is trumping accounting irregularities and corporate governance concerns that forced many U.S.-listed Chinese firms to be delisted since 2011.
Past misdeeds still fresh in minds...
According to John Hempton, chief investment officer of Sydney-based Bronte Capital, the lack of penalties for Chinese firms' past misdeeds in the '2011 scandals' meant the potential to find accounting fraud was always there.
The scandals Hempton speaks of sparked high tension between regulators of both countries regarding the oversight of auditors and access to company information that has continued ever since.
It was only a matter of weeks ago that a U.S. Securities and Exchange Commission (SEC) judge recommended banning Chinese units of the Big Four accounting firms from auditing U.S. listed companies.
However Reuters reckons the two sides could be close to a deal that would allow Washington to inspect the audit work of accounting firms in China, which could go a long away to alleviating strains.
