Canaan Downgrades IPO Target, Aiming to Raise $100 Million

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Per the updated filing with the Securities and Exchange Commission (SEC) on Wednesday, the Chinese hardware giant detailed that it will issue 10 million American depositary shares (ADS), each priced between $9 and $11.

Foreign companies aiming to list their shares in the US market need to denominate their equity share in ADS for purchasing in American stock exchanges.

Each of the proposed ADS will represent 15 Class A ordinary shares of the Chinese company, the filing detailed.

At this price, if all the ADS are subscribed in the initial public offering (IPO), the company will raise $100 million. In the original filing with the regulator last month, Canaan did now provide any listing details; however, it put $400 million as the intended amount to raise.

The updated offering numbers will put the overall market value of the company at $1.6 billion, with an enterprise value of $1.4 billion.

Impressing numbers before IPO

The update came after the company revealed its latest financials recently as a part of its application with the SEC. Canaan made $13 million in profits in the third quarter of this year as its sales figure increased drastically with the rebounding demand in the mining market.

Meanwhile, Canaan's biggest competitor Bitmain also pushing for a US listing and reportedly filed an IPO application with the market regulator.

Both companies headed to the US market amid multiple failed listing attempts in the Asian markets, notably in Hong Kong.

Canaan is the second-largest Bitcoin miner manufacturer, and it sells Avalon-branded high-performance ASIC-based mining machines for Bitcoin mining, which are designed and manufactured by the firm itself.

In the filing, the company detailed that in the first half of this year, it controlled 23.3 percent of the supply of global Bitcoin mining machines, while Bitmain held the major share of 64.5 percent.