Kingsoft Cloud sets price for public offering and private placement

BEIJING - Kingsoft Cloud Holdings Limited (NASDAQ: KC and HKEX: 3896), a prominent cloud service provider in China with annual revenues of $103.2 million, has announced the pricing of its underwritten public offering of American depositary shares (ADSs) and concurrent private placement. According to InvestingPro data, the company faces significant operational challenges, with a -4.53% revenue decline in the last twelve months. The public offering is set at $11.27 per ADS, with each ADS representing 15 ordinary shares, translating to a price of HK$5.83 per ordinary share based on the current exchange rate.

The company is offering 18,500,000 ADSs, equivalent to 277,500,000 ordinary shares. Investors have the option to receive ordinary shares to be traded on the Hong Kong Stock Exchange (HKEX) instead of ADSs. With a current market capitalization of just $26.96 million and a concerning current ratio of 0.69, this capital raise appears crucial for the company’s operations. The underwriters, which include Morgan Stanley Asia Limited, Goldman Sachs (Asia) L.L.C., and others, anticipate delivering the ADSs on a T+1 basis in the U.S. on April 17, 2025, and the ordinary shares on a T+5 basis in Hong Kong on April 25, 2025.

Furthermore, Kingsoft Cloud has granted the underwriters a 30-day option to purchase up to an additional 2,775,000 ADSs at the public offering price, less underwriting discounts and commissions. This purchase, if made, will be settled exclusively in ADSs.

Concurrently with the public offering, Kingsoft Corporation Limited, an existing shareholder, has agreed to purchase 69,375,000 ordinary shares in a private placement at the same price per share as the public offering. The company’s debt-to-equity ratio stands at 2.62, highlighting its significant leverage position. InvestingPro subscribers can access over 30 additional financial metrics and key insights about Kingsoft Cloud’s financial health. This transaction is subject to approval by independent shareholders and the completion of the public offering.

The gross proceeds from the public offering and private placement are expected to be approximately $260.7 million before deducting underwriting discounts, commissions, and other offering expenses. Kingsoft Cloud intends to use the net proceeds for infrastructure upgrades, technology and product development, and general corporate purposes.

The offering is being made pursuant to an automatic shelf registration statement filed with the SEC and available on their website. The final prospectus supplement will also be filed with the SEC.

This press release is based on a press release statement and contains forward-looking statements under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements reflect the company’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. For comprehensive analysis of Kingsoft Cloud’s financial health and future prospects, including exclusive ProTips and detailed valuation metrics, visit InvestingPro.

In other recent news, Kingsoft Cloud Holdings Limited has announced the launch of an underwritten public offering of 18,500,000 American depositary shares (ADSs), each representing 15 ordinary shares, amounting to a total of 277,500,000 ordinary shares. This offering includes a 30-day option for underwriters to purchase additional ADSs. Investors have the option to receive ordinary shares traded on the Hong Kong Stock Exchange instead of ADSs. The underwriting team for this offering comprises Morgan Stanley Asia Limited, Goldman Sachs (Asia) L.L.C., China International Capital Corporation Hong Kong Securities Limited, Deutsche Bank AG, Hong Kong Branch, The Hongkong and Shanghai Banking Corporation Limited, and Merrill Lynch (Asia Pacific) Limited. Completion of this offering is dependent on market conditions and other factors. Concurrently, Kingsoft Corporation Limited, an existing shareholder, has agreed to a private placement contingent on the public offering’s closing conditions. The proceeds from both the public offering and private placement are intended for infrastructure upgrades, technology and product development, and general corporate purposes. The ADSs and ordinary shares are available under an automatic shelf registration statement filed with the SEC.

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