Canaan Creative, one of the world’s largest mining equipment manufacturers, has just formally filed its third attempt to go public, following failures in Hong Kong and China. The makers of the Avalon ASIC miner have filed a prospectus with the Securities and Exchange Commission (SEC) in the US, which indicates that it intends to list on NASDAQ after a circa $400 million raise. 126 million shares are set to be issued by the Chinese company, although the price per share and final valuation are yet to be finalized.
Canaan’s Bear Market Blues
Canaan Creative is one of the lesser known names to Bitcoin mining outsiders, but their range of Avalon ASIC miners is very popular, and earlier this month a Chinese media outlet put the company’s valuation at between $2 billion and $3 billion. The prospectus doesn’t make enticing reading on the profits front however, with a $45.8 million loss posted for the six months ending June 30, 2019, on net revenue of $42.1 million and a net loss of $16.7 million in the six months prior. Like many other Bitcoin mining firms, the downturn in Bitcoin valuation in 2018-19 was the reasons behind this drop, and potential investors will be keen to know how the company will weather any further dumps.
Third Time Lucky?
The third-time-lucky attempt by Canaan follows failed IPOs in China and Hong Kong, where market uncertainty was blamed for a lack of interest. This echoes the experiences of mining giant Bitmain, whose Hong Kong application ended in failure, which is part of the reason behind Jihan Wu’s attempts to seize control of the company again. Canaan can also boast the world’s first Bitcoin mining TV, which they launched in August last year, although somewhat unsurprisingly this gimmick wasn’t referenced in the IPO material. Canaan will be hoping to take advantage of Bitmain’s present turmoil to grab a bigger slice of the Bitcoin mining pie.
According to public record, Jihan Wu took over Micree Zhan as the legal representative of Bitmain in China
Under China law, this means he serves as the legal embodiment of the company, which is a crucial role
Bitmain obviously can’t sit still while Canaan filed IPO
— Dovey 以德服人 Wan ? ? (@DoveyWan) October 29, 2019