Royole STAR Board Listing Withdraw
According to documents released by the Shanghai Stock Exchange, a withdrawal application for the IPO and listing of Shenzhen Royole Technology Co (pvt). was submitted by the company and its sponsor, which was accepted by the exchange and terminated the audit review. While no details were given for the withdrawal, we suspect the back and forth dialog between the STAR Audit committee and the company did not go well and the requirements for listing were too onerous for the company.
We note that on 12/31/20 we wrote about a few of the ‘risk factors’ in the Royole Prospectus, including low utilization rates, losses each year, and the expectation that the company was still in the market expansion phase and would require continued R&D leading to further losses. Whether these details would have caused a lack of enthusiasm from potential investors is now a moot point, which could postpone the company’s capacity expansion plans, which included a $2.48b flexible OLED fab in Qindao, China, some of which is (was?) being financed by the Qingdao Science & Technology Bureau, the Qingdao Shanghe Demonstration Zone, the Quingdao Urban Construction Investment Group, and the Quingdao Caitong Group, all state or local government owned real estate developers and construction companies. The company had previously raised $1.b through a series of financings and debt, which is likely a better route given the company’s current status.
We note that on 12/31/20 we wrote about a few of the ‘risk factors’ in the Royole Prospectus, including low utilization rates, losses each year, and the expectation that the company was still in the market expansion phase and would require continued R&D leading to further losses. Whether these details would have caused a lack of enthusiasm from potential investors is now a moot point, which could postpone the company’s capacity expansion plans, which included a $2.48b flexible OLED fab in Qindao, China, some of which is (was?) being financed by the Qingdao Science & Technology Bureau, the Qingdao Shanghe Demonstration Zone, the Quingdao Urban Construction Investment Group, and the Quingdao Caitong Group, all state or local government owned real estate developers and construction companies. The company had previously raised $1.b through a series of financings and debt, which is likely a better route given the company’s current status.
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