China’s state-run People’s Daily news site in $84 million IPO move (as Chairman Mao rolls in his grave)

The online arm of People’s Daily, China’s state-run news agency, has launched an initial public offering (IPO) in Shanghai. The move is aimed at raising funds to develop its editorial team, technology and delivery to mobile, as it looks to better rival Sina, 163 and others.

Reuters reports that the company will set its price range on April 17 with final pricing expected to be revealed April 20. The news agency is aiming to raise as much as $83.6 million (527 million yuan) by selling 69 million shares.

Update [17/04/12]: Reuters reports that the exchange filing states the IPO will raise $245.45 million (1.55 billion yuan), that’s three times higher than the original estimate.

Sources close to the organisation revealed that it could start its roadshow to drum up interest from investors as soon as tomorrow (April 6), when China’s Qingming (Tomb Sweeping) festival concludes, according to Caijing.

Rumors suggesting that the government mouthpiece would list first surfaced in January and the speculation becomes a reality after People’s Daily gained the necessary state approval at the end of March.

The agency is one outlet that Chinese authorities frequently use to get messages and propaganda into the public domain, other avenues include the Xinhua newswire and the Global Times.

The move is certainly controversial (The Globe and Mail quips that Chairman Mao would be rolling in his grave) but it reflects the growth and development of China’s online news space.

With more than 500 million Internet users — more than half of which use Weibo microblogs — and growing mobile Web usage, online is a key platform for reporting and broadcasting news in China. Caijing’s report also suggests that Xinhua will go public this year as China looks to strengthen its media.