Leshi Internet Information & Technology Corp. will cut its planned fundraising by more than a third to a ceiling of 4.8 billion yuan ($753 million) as Chinese stock market volatility soars to unprecedented levels.
The online video service, part of the fast-growing LeTV group of Internet companies founded by billionaire Jia Yueting, said in a statement dated Aug. 31 it made its decision after considering “capital market conditions and its own needs.”
Leshi’s move comes as China heads toward its slowest pace of growth in 25 years. Stocks in Shanghai ended August with their biggest two-month drop since 2008.
Leshi said in May it intended to sell 200 million shares to raise 7.51 billion yuan. The CSI 300 index of Chinese stocks has slumped 34 percent since that announcement through Monday. The company said it now plans to sell as many as 155 million shares.
Shares of Leshi shares rose 1.4 percent at 34.30 yuan in morning trade.
Parent Le Holdings (Beijing) Co., which controls LeTV-branded businesses spanning smartphones and a sports website, is considering acquisitions to help it expand into the U.S. and Southeast Asia. Its sports video service, LeTV Sports, said in July it is trying to raise $500 million at a $3 billion valuation.