PC Maker Lenovo Group Issues Response to Withdrawal of STAR Market IPO

lenovo
(Source: VCG)

On October 10, Chinese PC manufacturer Lenovo Group responded to the termination of its listing to the Shanghai Sci-Tech Innovation Board (STAR Market). “Considering the scale and complexity of the company’s business, the financial information in the prospectus may expire during the application review process. At the same time, after carefully considering the latest capital market conditions, we decided to withdraw the listing application,” Lenovo said in a statement.

The announcement also affirmed that Lenovo’s business operation is in good condition, and withdrawing the application will not have any adverse impact on its financial situation.

Lenovo submitted its STAR Market listing application on September 30 and received approval on the same day. According to the prospectus, the company will offer less than 10% of its total share capital to raise 10 billion yuan ($1.54 billion).

However, after seven days of the National Day holiday and one trading day, the official website of the Shanghai Stock Exchange showed that Lenovo and its sponsor CICC had submitted documents for withdrawing the Shanghai listing.

SEE ALSO: Chinese PC Maker Lenovo Withdraws Application for Shanghai Listing, Eight Days After Application Approval

Although the PC market is hot, manufacturers including Lenovo face challenges such as the shortage of necessary components in the supply chain. Yang Yuanqing, Chairman and CEO of Lenovo, said in May that “PCs, tablets, even electric vehicles all have high requirements for chips. We expect that chip shortages will continue for 12 to 18 months, and the supply situation determines the growth of PC sales.”

In 2020, the global market share of Lenovo’s PCs was 24%. In the smartphone market of Latin America and North America, Lenovo’s products’ market share sits at 15.0% and 5.5%, respectively, ranking second and fifth in the regions. In terms of data center business, according to IDC statistics, Lenovo’s data center equipment shipments reached 707,500 units in 2020, with a market share of 6% in the global market, ranking fifth.