South Korean AI services company Elice Group’s shares fell 30% on their market debut on 20 October, trading at 63,600 won against an IPO price of 90,500 won, CNBC reported. Elice raised 201.1 billion won ($150 million) in the offering. Reuters reported a 28% fall and a last-traded price of 65,300 won.
Key points
- CNBC put Elice’s debut decline at 30%; Reuters reported 28%.
- Elice plans to put most of its IPO proceeds towards portable modular data centres and related infrastructure.
- Firmus shelved its Australian IPO on 9 October. AirTrunk and SB Energy also halted listing plans in October.
Elice’s 90,500 won offer price
Elice provides AI cloud services alongside AI-based education and business software. It plans to spend most of the money raised in its IPO on launching portable modular data centres and related infrastructure. The share sale therefore brings capital into a business that intends to expand its computing capacity, even as its first day of trading put the stock below the price paid by IPO investors.
The offer was priced on 6 October, before a recent sell-off in AI-related stocks, analysts cited by CNBC said. A filing put institutional orders at 388.84 times the shares available in the offering, CNBC reported. The subsequent trading prices reported by CNBC and Reuters were both below it.
Elice has said its first-half revenue reached 34 billion won, three times its level a year earlier. It reported an operating profit of 10 billion won for the period, against an operating loss of 3.5 billion won a year earlier. Those results preceded the planned spending on modular data centres funded by the IPO.
Firmus turns to private fundraising
Australian data centre operator Firmus, which is backed by Nvidia, shelved its $5 billion IPO on 9 October and said it would pursue private fundraising instead, Reuters reported. Firmus cited market volatility and conditions. It said it would also consider other public and private market options.
The planned offering, previously covered by AI Affairs, had set a price of A$11 a share. That would have given Firmus an equity valuation of $30.6 billion, nearly triple the $10.5 billion valuation it reached after a fundraising round at the start of August. Firmus said the terms of the proposed IPO did not properly reflect its business and long-term growth outlook. Its board concluded that proceeding would not be in the best interests of the company and its shareholders.
Firmus designs and operates modular AI data centres. It had two online, in Melbourne and Singapore, while five more planned across the Asia-Pacific region were at an early stage of development. The gap between its operating sites and planned expansion was part of the business investors were being asked to value in the proposed share sale.
AirTrunk and SB Energy halt listings
Blackstone-backed AirTrunk postponed a Singapore IPO through a real estate investment trust in October. SB Energy, a unit of SoftBank, had filed paperwork for a US IPO but shelved the plan during the same month. Unlike Elice, neither company completed the listing it had planned.
Elsewhere in the market for AI infrastructure listings, AI Affairs reported investor pushback on Nscale’s $30 billion IPO valuation. Kim Hak-joon, an analyst at Seoul-based Kiwoom Securities, said investors were worried companies of this kind might struggle to secure additional funding.
