China’s SenseTime relists HK IPO after US blacklisting
Chinese artificial intelligence start-up SenseTime said Monday it will press ahead with its Hong Kong listing, a week after it was blacklisted by the United States over accusations of genocide in Xinjiang.
An initial listing earlier this month was pulled when the US Treasury announced new sanctions, saying SenseTime’s facial recognition programmes were designed in part to be used against Uyghurs and other mostly Muslim minorities in Xinjiang.
On Monday, the company filed a revised listing with the Hong Kong stock exchange with trading expected to start December 30.
“Due to the dynamic and evolving nature of the relevant US regulations, we have required to exclude US investors,” the company wrote.
Bloomberg News reported that SenseTime had secured about $512 million from nine cornerstone investors, including state-backed Mixed-Ownership Reform Fund and Shanghai Xuhui Capital Investment Company.
The company is still planning to hit the pre-blacklisting $767 million target with 1.5 billion shares at HK$3.85 to HK$3.99 per share.
Washington accuses SenseTime of being part of China’s “military-industrial complex” that provides technology for mass surveillance in Xinjiang.
It says SenseTime has developed and deployed facial recognition software that can determine a person’s ethnicity, including whether someone looks Uyghur.
SenseTime refuted the blacklisting, saying that the accusations were unfounded and emphasised that the company was “caught in the middle of geopolitical tension”.
The Treasury sanctions prevent individuals from obtaining visas to the United States, block assets under US jurisdiction, and prevent targets from doing business with American individuals or entities — effectively locking companies out of the US banking system.
The blacklisting made it all but impossible for US investment banks usually involved in Hong Kong listings to get involved.
The plight of the Uyghurs has contributed to worsening diplomatic relations between Western powers and Beijing.
It has also ensnared a growing number of international businesses in tit-for-tat sanctions between the two sides.
UN experts and researchers estimate more than one million Uighurs and other Muslim minorities have been incarcerated in prison camps in Xinjiang.
Human rights groups and foreign governments have found evidence of what they say are mass detentions, forced labour, political indoctrination, torture and forced sterilisation.
Washington has described it as genocide.
After initially denying the existence of the Xinjiang camps, China later defended them as vocational training centres aimed at reducing the appeal of Islamic extremism.