Renren soars after float

 
City A.M. Reporter
SHARES of Renren, dubbed “China’s Facebook”, surged nearly 50 per cent in their stock market debut yesterday in the latest sign that investors are eager to buy into social media and China’s booming internet sector.

The shares rose to $20.62 (£12.50), or 47.3 per cent above their $14 IPO price, in early trading on the New York Stock Exchange, before settling up 28.6 per cent at $18.01. Renren raised $743.4m in its IPO.

High valuations for rival companies, combined with the fact that China is the biggest internet market in the world, helped Renren attract strong investor demand.

Beijing-based Renren sold 53.1m American Depositary Shares for $14 each, raising $743.4m. It had planned to sell shares for $12 to $14 each after raising the expected price range by 30 per cent last week, from $9 to $11 per share.

Morgan Stanley, Deutsche Bank and Credit Suisse led underwriters on the IPO.

The strong demand for Renren shares comes despite concerns about the firm’s internal financial controls, the resignation of the chairman of its audit committee, and fears over China’s censorship of internet firms.