VeriSilicon Raises $268 Million in IPO as Stock Jumps 289%
Chipmaker VeriSilicon Microelectronics traded at more than three times its original initial public offering.
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Steven Lerner
Aug 20,2020,21:59

Semiconductor stocks continue to be the stars of the Shanghai Stock Exchange.

Chipmaker VeriSilicon Microelectronics traded at more than three times its original initial public offering of 38.53 yuan (about $5.57) to 155 yuan (about $22.41) on Tuesday, the day the company joined the Sci-Tech Innovation Board (STAR market).

The company’s stock price fell to 128.48 yuan (about $18.58) on Thursday, which still represents a massive increase from its original IPO.

Founded in 2001, VeriSilicon is a semiconductor firm with offices in both China and the U.S. Roughly half of its business is outside of China.

Deloitte ranked VeriSilicon among its top 50 high tech and high growth companies in China.

Prior to going public, two of its largest private shareholders included the China Integrated Circuit Industry Investment Fund and Xiaomi Corporation, which took a 6% stake in the company last year.

VeriSilicon reportedly raised 1.86 billion yuan (about $268 million) in its IPO. The company says the funds raised will focus on research and development of its chips for smart wearable devices, intelligent vehicles, smart homes, and smart cities.

At the time of IPO, the company had a market value of 18.6 billion yuan (about $2.7 billion).

Another Semiconductor Success Story

Within minutes of going public, VeriSilicon’s price jumped 289% from its issue price.

It’s not the first time that a semiconductor had an outstanding premiere on the Shanghai Stock Exchange. In July, the Semiconductor Manufacturing International Corp made the exchange’s biggest listing in a decade. 

Semiconductors have generally experienced huge IPOs in China as of late thanks to Beijing's support for chip-making companies. The rise of 5G has also played a role in the value of semiconductors. Many Chinese investors are bullish for China-based tech successes.

Part of the reason why VeriSilicon had an extraordinary open on Tuesday could be because it served as a response from Chinese investors in the wake of the newest restrictions against Huawei from the U.S.

Topics :semiconductor
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