(Yicai Global) May 18 -- Several of China's largest internet companies may invest in an internet and industrial-focused arm of Taiwanese Hon Hai Precision Industrial Co., better known as Foxconn, during its upcoming initial public offering, reported state-backed Securities Times, without specifying any names.

Foxconn Industrial Internet Co. aims to raise CNY27.3 billion (USD4.3 billion) by floating 1.8 billion shares, or 10 percent of its equity, on the Shanghai Stock Exchange. The China Securities Regulatory Commission approved the IPO application on May 3 and the firm is currently selecting its investors before announcing the listing date.

The fast clearance of Foxconn's application underlines the priority that China gives to technology companies as it aims to become Asia's hub for fundraising, reported South China Morning Post, adding that normally an IPO applicant needs to wait for about two years for approval.

The Shenzhen unit has strong prospects and most institutional investors expect it to offer a price-earnings ratio of 20 to 23, according to an institutional investor who attended the firm's roadshow in its home city.

The IPO funds will be used for eight projects, including building a data center, as well as developing capacity for cloud computing, 5G mobile network technologies, projects related to the Internet of Things, and to expand into intelligent manufacturing, according to the firm's stock sale prospectus. 

Foxconn makes parts for smartphones and wireless equipment, and its clients include Amazon.Com Inc., Apple Inc., Cisco Systems Inc., Dell Inc., Huawei Technologies Co. and Lenovo Group Ltd. The subsidiary unit makes electronic devices, cloud service equipment, and industrial robots.

Editors: Emmi Laine, William Clegg