Monday, 8 August 2005

Baidu.com Listing Overshadows Google's Historic Float

Shares of China's largest Web search company, Baidu.com Inc., more than quadrupled in value in their U.S. market debut on Friday in the most spectacular entry ever by a foreign company, overshadowing world search leader Google Inc.'s float last year. The meteoric debut of the Beijing-based company fed by investors hungry for a growth story was reminiscent of the Internet heyday, when shares of new online and technology companies routinely trebled on their first trading day.

Baidu.com's float, with its irresistible mix of China and the Internet, sparked huge interest globally, with the company described as a potential Chinese Google well placed to serve the world's most populous country, where Web use is surging. But even analysts expecting a strong debut were stunned as Baidu.com shares more than quadrupled the USD 27 per American Depositary Share (ADS) pricing of its initial public offering, the first U.S. listing of a pure-play Chinese search engine.

"It's just been amazing. It could be over-enthusiasm, it could be the way Google charted, but there is obviously a lot of speculative buyers who think this could be an Asian Google," said Sal Morreale, who tracks IPOs for Cantor Fitzgerald. Baidu.com shares surged over 450 percent to a high of USD 151.21 during intraday trading on Nasdaq on Friday. They closed up almost 354 percent at USD 122.54.