An Initial Party Offering? China's communists go for an IPO of their news site.
| Beijing
The ruling Chinese Communist party is using a classic capitalist scheme to raise money: An IPO.
Not that the party (slogan: 鈥淪erve the People鈥�) is offering the public shares in itself. But it plans to sell stocks in the online version of its official mouthpiece the People鈥檚 Daily.
The 飞别产蝉颈迟别听is having a hard time keeping up with the commercial competition, according to its owner People鈥檚 Daily Online Co. Ltd. in a preliminary prospectus filed with the China Securities Regulatory Commission. It gets one tenth the visitors than the most popular Chinese Web portal Sina.com, for example.聽
To rectify this, the company wants to raise $83.5 million through an IPO in Shanghai to 鈥渟trengthen our marketing and expand our services and products,鈥� the prospectus says. That way it hopes to catch up with Sina, which has tapped international capital markets by listing on the NASDAQ.
The company makes no reference to the fact that the party-owned website may owe its low profile to the stultifying nature of its content. Indeed, it mentions the 鈥淧eople鈥檚 Daily journalism tradition鈥� as one of its competitive advantages, which sounds a little dubious.
Another聽selling point聽it boasts, though,聽is the 鈥減referential policy鈥� the website enjoys; this means that the party which owns it also owns the government that makes the rules deciding who else is allowed to disseminate online news in China. Now that is a competitive advantage.聽
