(Yicai Global) May 16 -- 360 Security Technology Inc. is planning a private placement of shares to raise nearly CNY10.8 billion (USD1.7 billion) as the Chinese online security firm looks to build research and development centers in the booming artificial intelligence and big data sectors.
The third-party allocation will comprise no more than 1.35 billion shares, the Beijing-based firm said in a filing to the Shanghai Stock Exchange yesterday. The company's stock [SHA:601360] gained just over 3 percent today to CNY37.87 (USD5.94). Trading had been suspended since May 2 pending an announcement on the private placement.
360 Security and others such as Pony Ma's tech giant Baidu Inc. and Kai-Fu Lee's seed funder Sinovation Ventures are investing heavily in AI as China seeks to become a global powerhouse in the fields. China's cabinet released a document last July setting out a goal of making the country dominant in AI by 2030, while the top economic planning agency has kicked off a national program to promote internet+, AI and the digital economy.
360 Security is planning nine projects with the cash raised. The biggest will be an almost CNY4.7-billion big data center, which 360 hopes will enhance its support and service capabilities in data storage and analysis, networking and security. It will also use nearly CNY1.2 billion to set up a new-generation artificial intelligence hub for video analysis and cloud services.
Another CNY1.2 billion will go toward a smart search and commercialization project, which aims to upgrade technologies, content and products in online advertising. The improvements would allow more commercial customers to tailor their marketing using advanced targeting and grant users access to more information channels.
Formerly called Qihoo 360 technology Co., the company began trading in Shanghai in February after ending a five-year listing in New York in July 2016. The firm chose to repatriate because it provides network security protection and solutions to many sectors and was unable to obtain the necessary qualifications for many businesses as a foreign entity, according to Chairman Zhou Hongyi.
The firm said last November that it would inject its assets into shell company SJEC Corp. in a so-called backdoor listing, wherein a privately held company buys a publicly held one to side step what until recently has been a much lengthier regulatory process for initial public offerings in China.
Editor: James Boynton