Smok Parent Considers Initial Public Offering

Shenzhen IVPS Technology Co. is considering an initial public offering in Hong Kong as soon as next year, reports Bloomberg, citing sources with knowledge of the matter.

The vaping device company could raise between $500 million and $1 billion, the people said.

Founded in 2010, IVPS makes vaping kits under its Smok brand. The devices are used by more than 80 million consumers globally and are sold online as well as via distributors in countries such as France, Kuwait and the U.K.

The Chinese e-cigarette industry has been under mounting pressure in its domestic market. In March, China’s Ministry of Industry and Information Technology proposed a draft regulation that would apply the same rules for the conventional tobacco industry to the e-cigarette sector. The aim is to regulate production and marketing of new types of tobacco products and prevent false advertising and quality issues, the ministry said.

In 2019, Beijing banned online sales of e-cigarettes.

Shares of several Chinese e-cigarette companies plunged following the draft’s release in March. Hong Kong-listed device maker Smoore International Holdings’ shares are down about 40 percent this year.

While rising regulatory scrutiny of the vaping industry could impact investor appetite for listings in the sector, IVPS could be less affected because it makes the device rather than the e-cigarette liquid.