CICC mainly relied on documents provided by Lenovo, the regulator said. “Related procedures and the evidence obtained were insufficient to support the disclosure, and [the bank] did not completely and accurately evaluate the [business] nature of the issuer on whether it is of scientific and technological innovation,” CSRC said.
China’s regulators tightened the rules for IPOs on the Star Market in April, raising the bar for firms to prove their technology credentials. Technology firms, including those involved in information systems and advanced manufacturing equipment will be fast-tracked for approvals. Regulators also banned financial services providers and property investment firms from listing on the board.
Under the new rules, a company must fulfil four criteria to qualify for the definition of “scientific and technological innovation.” Research and development spending must surpass 5 per cent of revenue in the past three years, or more than 60 million yuan (US$9.4 million) in the same period, according to the rules.
A successful Shanghai listing would have made Lenovo one of a few Chinese companies to have shares listed in mainland China, Hong Kong and New York. Lenovo’s shares fell 2 per cent in Hong Kong trading to HK$8.81, after dipping 0.5 per cent overnight in New York to US$22.90.
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