(Reuters) – Ping An Insurance OneConnect Financial Technology on Wednesday reduced its planned U.S. initial public offering by 28% and lowered its target rating, dealing another blow to investor SoftBank (9984.(T), which is still reeling from the fall-out of WeWork’s failed tender.
OneConnect has a price range of $9 to $10 per share, the initial public offering of 26 million shares for $12 to $14 per share range it had provided earlier.
The company has also reduced the demand of the 36 million American depositary shares (“Ads’s”) to be 26 million on the Ads.
OneConnect, a unit of China’s biggest insurer by market value, Ping An Insurance Group Co. of China Ltd., which counts Japan’s SoftBank, and a Japanese financial company, SBI Group, as a few of the most important investors.
The upper end of the range of values OneConnect is approximately $3.64 billion.
That’s well below the $7.5 billion valuation last year, when it raised $750 million in its first funding round from investors including Japan’s SoftBank, and a Japanese financial company in TAI Group of companies.
The float, which comes in as a tech investor, they turned a smart car on the exit of a sale of shares of a large portfolio of company, WeWork, as well as its first quarterly loss in 14 years, pulled down by a $8.9 billion hit on the giant’s Vision Fund, which has invested in OneConnect.
A number of other potential stock market listings have been reduced since the collapse of WeWork’s scheduled to launch in September, and the investment bankers are concerned that the trend is set to continue next year.
Some 44 companies have pulled out of their U.S. IPO filings in 2019 on Nov. 3, which is almost 50% by 2018-the highest level since 2016, according to IPO research firm Renaissance Capital.
“I think that this (the recent turbulence in the financial markets will cause some companies to pause in the IPO plan, especially for those with weak unit economics, and it is not a clear path to profitability, they will have to delay the Ipo to start, or to continue the sales opportunities instead of this,” said Kristine Di Bacco, a partner in the Field of corporate law firm Torys llp.
“I think it’s really great businesses (Airbnb, for example), it will not be quenched, and they will still plan to do the IPO.”
Report by Bharath Manjesh, and Amal in Bengaluru; Editing by shailesh Kuber