Xinhua Finance Media Ltd. filed for an initial public offering on the NASDAQ market today under the symbol XFML. The financial news gathering service expects to raise about $300 million by issuing 23.1 million American depository receipts (ADRs) priced at between $12 and $14 each. Underwriters in the deal include J.P. Morgan, UBS Investment Bank, and CBIC World Markets among others. The company reported a 2006 net income of $3.3 million on revenues topping $59 million. After the IPO, Xinhua is expected to carry a market capitalization of about $1.8 billion, based on a $13 IPO price. The company said it will use $50 million of its IPO proceeds to repay debt, and the rest for acquisitions, working capital and other general corporate purposes.

What does the company do? Well according to their IPO prospectus (F-1 filing for foreign companies), the company engages in the creation and production of high-quality content that is distributed across nationwide television and print media outlets and radio in Beijing and Shanghai, and where advertising sales are supported by their own advertising agency. These outlets reach an estimated 210 million potential television viewers, a potential listening audience of 33 million people, and the readers of leading magazines and newspapers. In addition, the company's market research business enables our advertisers to analyze, understand and better reach their targeted consumers. Meanwhile, Xinhua's actual content currently focuses on business and financial news as well as wealth management and affluent lifestyle programming. They focus on this programming because we believe it attracts the highest income audience in China - an audience that is highly sought after by their target advertisers.

This is a great IPO to keep an eye on as past Chinese IPOs have done exceptionally well recently. The strong growth in these markets combined with increased exposure to foreign capital markets and investors have led to substantial gains for shareholders investing in Chinese companies.