Thaindian News

Beijing, Feb 3 (IANS) Facebook’s planned initial public offering (IPO) will give impetus to China’s social networking sites and boost their development, industry leaders here said.

Facebook filed with the US Securities and Exchange Commission an application Wednesday to raise $5 billion in a preliminary IPO, one of the largest technology offering so far.

“Facebook’s IPO is a milestone event in the global internet arena,” the China Daily Friday quoted Cheng Binghao, CEO of China’s top social networking site Kaixin, as saying.

In the next few years, social networking sites will become the mainstream of internet, and the IPO of Facebook will make more people realize the change, Cheng said.

Fang Xingdong, founder of blogchina.com and web research consultancy chinalabs.com, said many venture capitalists would benefit enormously from the IPO.

“The move will also fortify market confidence over investment in the internet,” he said.

China’s networking sites have witnessed a dramatic rise in stock market after Facebook’s announcement.

Shares of New York-listed Chinese social networking company Renren Inc., which is dubbed China’s Facebook, rose by 33 percent, while shares of NASDAQ-listed Sina Corp., owner of China’s popular Twitter-like Sina Weibo microblog service, rose by 18.8 percent.

Networking sites have mushroomed in China in recent years and some of them have successfully listed on overseas stock markets.

It is estimated that 269 million internet users in China were registered at networking sites by the end of 2011, which had a market value of about 2.1 billion yuan ($328 million), according to market research firm Analysys International, the daily said.