It has been such a rough year for Chinese stocks on overseas markets that yesterday the China Mobile Games and Entertainment Group (CMGE) became only the second company from the country to list in the US this year. Yesterday its NASDAQ:CMGE ticker hit the trading floor where the mobile gaming firm took the unusual path of listing ‘by way of introduction’.
This backdoor listing method means that CMGE has hit the market, but isn’t necessarily going for an IPO of its shares. Yet. It also means there’s no price. But as the China Daily notes, the reception that CMGE got wasn’t all that warm:
The company’s American depositary shares (ADS), each representing 14 Class A ordinary shares, began to trade on the Nasdaq under the ticker symbol CMGE but failed to settle a price on its debut.
As of Tuesday’s close, investors had put in a high bid price of $3.90 per share, not even close to the ask price of 40 dollars.
CMGE claims to be China’s biggest mobile gaming developer and publisher, and is a spin-off from VODone, the massive semi-state-owned media company. CMGE’s chariman, Zhang Lijun (pictured center in the image on the right), told state news agency Xinhua yesterday that the firm doesn’t urgently need financing at the moment, and is happy using the listing just to raise its profile at home and overseas. But even without the full IPO, CMGE must now file financial reports to the US SEC.
The company might want to wait for a better economic climate – and warmer attitudes towards Chinese tech stocks, so tarnished by last year’s Longtop financial scandal – before going for the full IPO.
CMGE is NASDAQ’s first Chinese stock this year. The only other US lister from the nation this year was the flash sales site VIPShop (NYSE:VIPS), which is currently slightly up on its $6.50 debut at $6.90 per share.