Shanda Networking Heads For Nasdaq Listing
Shanda Networking, China's largest online game company,
is heading for a Nasdaq listing in 2004, and is aiming
for a valuation of US$1 billion. The company is controlled
by Chen Tianqiao, 31, who is believed to own more than
70 percent of the company. Chen is listed as the sixth
wealthiest person in China on the China Forbes list, with
a net worth of US$480 million.
It is believed that the Shanghai-based company will have
Goldman Sachs as the lead underwriter for the listing,
which could take place as early as the beginning of next
year. Compared to Asian markets, companies listed on the
US Nasdaq command a premium valuation.
Shanda has 150 million registered users for its online
games. Users buy cards for 35 yuan (US$4.20) for 120 hours
playing time. Its best-selling game, Legend, generates
cash through sheer volume, and up to 1 million players
play at any one time.
According to Chen, the company made profits of US$25
million on revenues of $50 million, and he expects those
numbers to double this year. Analysts estimate that revenues
currently total $200 million, will reach $900 million
within two years, with more than 12.6 million paid players.
In March, Shanda attracted a US$40 million investment
from Softbank. Presumably the IPO will give Softbank a
chance to cash in on some of its investment.
Shanda recently settled a dispute with Actoz, a Korean
games company, which had accused Shanda of copying its
content. Shanda initially started as the China distributor
for Actoz's game, the Legend of Mir.
Shanda is now actively developing its own games, and
will transition to offering its own products through its
gaming network.
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