DOMESTIC artificial intelligence (AI) giant SenseTime Group Inc. postponed its initial public offering (IPO) in Hong Kong after being added to a U.S. sanction list, the company said yesterday.

The U.S. Department of Treasury added SenseTime to the list of so-called Chinese military-industrial complex companies Friday and the addition would prohibit U.S.-based investors from buying the firm’s shares.

SenseTime, which was expected to raise HK$5.99 billion (US$768.3 million) in the IPO, said yesterday it remained committed to completing the offering and would publish a supplemental prospectus and an updated listing timetable. The firm said the postponement of its IPO would give investors time to assess the U.S. move’s potential impact.

SenseTime had planned to sell 1.5 billion shares in a price range of HK$3.85 to HK$3.99, according to its regulatory filings. That would raise up to US$768.3 million, a figure that had already been trimmed earlier this year from a US$2 billion target.

However, instead of setting its listing price Friday, as scheduled, the firm found itself in urgent talks with the Hong Kong stock exchange and its lawyers over the future of the deal amid reports about the looming blacklist.

SenseTime did not provide details on the timetable for a revised IPO in its filing to the Hong Kong exchange yesterday.

“The firm remains committed to completing the global offering and the listing soon,” it said in the filing, adding it would publish a supplemental prospectus with an updated listing timetable and other relevant information.

Sensetime said in a statement Saturday that the U.S. government’s accusations are “unfounded and reflect a fundamental misunderstanding of our company.” The firm will “take appropriate action to protect the interests of our company and our stakeholders.”

The company said it would refund all IPO application monies in full, without interest, to all applicants who subscribed its shares in the offering process.

SenseTime is backed by major investors such as SoftBank Vision Fund and Alibaba Group Holdings. The company provides technology-based applications, including facial recognition, video analyzing and autonomous driving.

The firm was also among eight Chinese tech companies placed on a U.S. blacklist in 2019. (SD-Agencies)