Rhymes with voodoo

4 August 2005 By Robert Cyran Follow @rob_cyran

Baidu.com is the most popular search engine in the biggest country on earth. It s even profitable. An attractive investment, surely? Not necessarily, considering the group s odd holding structure, demanding valuation, aggressive competitors and insider selling.

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China's biggest search engine, Baidu.com, launched its initial public offering in New York on August 5. Underwriters priced the shares at $27, which is above their raised indicated price range. The value of the shares sold will be $124m assuming underwriters sell their overallotment of shares.

About 80% of the proceeds will accrue to the company, with the remainder going to insiders. The group will have a market capitalisation of $872m at $27 per share.

The group's earnings were $1.5m last year.

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