Alibaba, Baidu invest in Horizon Robotics’ Hong Kong IPO

Alibaba (NYSE:BABA) and Baidu (NASDAQ:BIDU) have emerged as cornerstone investors in Hong Kong’s upcoming initial public offering of Horizon Robotics, a Chinese company specializing in autonomous driving technology, Bloomberg reported.

Intel-backed (INTL) Horizon Robotics is a provider of software and hardware used in autonomous driving systems and is aiming to raise HK$5.4 billion ($696 million) by selling 1.36 billion shares at HK$3.73 to HK$3.99 each.

French shipping billionaire Rodolphe Saade’s CMA CGM and a Ningbo government fund are also cornerstone investors. Together, these cornerstone investors have subscribed for a total of ~$220 million in stock led by Alisoft China (BABA) and Baidu (BIDU), which have bid for $50 million each.

Volkswagen (OTCPK:VWAGY) also has a small stake in the company. Other backers of the IPO include China’s BYD (OTCPK:BYDDF) and Contemporary Amperex Technology.

Horizon Robotics was founded in 2015 and is managed by Kai Yu, a scientist with expertise in artificial intelligence who was a key player in Baidu’s (BIDU) push for autonomous driving.

The company is seeking a valuation of up to $6 billion before including the funds raised in the IPO, people with knowledge of the matter said. This positions it as one of the largest listings in Hong Kong this year.

The company will begin accepting orders on Wednesday, October 16. The discussions are still in progress, and specifics like the IPO’s size could change.