Xunlei Plans U.S. IPO

March 8, 2011 by Yonah
Filed under: Announcements & Events, File-Sharing Programs, Networks & Services

The Chinese firm Xunlei – a Google-backed file-sharing website that offers video and music content – once sued (2008) for film piracy by six Hollywood studios – has now launched a fund-raising project for over $200 million in a U.S. initial public offering, hiring JPMorgan Chase and Deutsche Bank to get ready.

On Thursday Bloomberg News reported (thanks to sources familiar with the IPO plans) that Xunlei will follow Youku – a Chinese video-sharing firm – and e-commerce website DangDang into the U.S. market.

According to a consultancy firm from Beijing (Analysis International), Xunlei had about 190 million online video users at the end of 2010.

Youku’s shares in the U.S. reached 161% with their debut in New York from December the 8th. Xunlei hopes to repeat this performance by posting the sharpest first-day gain in a U.S. IPO since shares of leading Chinese search-engine Baidu were listed in 2005. This is not an easy task, however, since they’ll have to convince U.S. investors of their legitimacy and this by having a copyright infringement lawsuit in their past.

Speaking of the past, MPAA pointed-out Xunlei’s activities in 2007. That very same year brought to them investors from Google and other firms. In 2008 a lawsuit started by Hollywood studios because of the 78 movies shared on their website was directed against Xunlei. MPA member companies claimed a fine of $975,000, a public disgrace and the promise of ceasing such activities. Later that year, Xunlei paid around $21.000 in damages to Shanghai Youdu Broadband Technology for profiting from the illegal online distribution of Confession of Pain starring Tony Leung and Takeshi Kaneshiro.

If such a past will or will now affect their plans for the future is to be seen.

Tags: file sharing service, file-sharing, US