According to two sources with direct knowledge of the matter at hand, Chinese artificial intelligence startup SenseTime Group is in talks with officials of the Hong Kong Stock Exchange regarding the fate of its $767 million planned IPO in Hong Kong.
The move comes after a report from the Financial Times stating the United States will place the company on an Entity List, a trade blacklist, which would mean it would bar U.S.-based investors from buying its shares.
Sources preferred the cover of anonymity since the information has yet to be officially made public.
The Chinese startup planned on selling 1.5 billion shares within a price range of HK$3.85 to HK$3.99 each in the IPO. According to the company’s filing, it was due to set a final price for its IPO and allocate shares to institutional investors on Friday.
According to sources with knowledge of the matter at hand, SenseTime and its advisors held urgent talks late on Thursday and early on Friday on how the potential US trade ban would impact its IPO.
While U.S.-based investors had initially lodged bids to buy its shares during the bookbuilding process, some investors pulled their bids to buy shares once the potential US trade ban was reported.
More than 50% of the deal had been sold to cornerstone investors ahead of its IPO scheduled for launch on Monday.
SenseTime is scheduled to start trading on December 17, as per its filing.