China AI champion SenseTime mulls separate fundraising for auto and healthcare units, people say
SenseTime Group is exploring carving out its autonomous driving and healthcare units for separate fundraising, people familiar with the matter said, as the Chinese AI company looks to expand these businesses.
The Hong Kong-listed firm has approached potential investors about the funding plans, said the people, who asked not to be identified as the information is private. SenseTime is looking to sell partial stakes in the units to other companies in the industry, followed by financial investors at a later stage, one of the people said.
Considerations are at an early stage and SenseTime has not made final decisions including valuation targets for the units, said the people. The company could also decide against pursuing any deals, they said. A representative for SenseTime did not respond to requests for comment.
Chinese AI champion SenseTime on the defensive after short seller report
Chinese AI champion SenseTime on the defensive after short seller report
Founded by computer scientists in 2014, SenseTime specialises in AI-powered software that analyses faces and images on an enormous scale and works with law enforcement bodies, retailers and healthcare researchers around the world, according to its website. It raised HK$5.78 billion (US$740 million) in a Hong Kong initial public offering in December 2021 after concerns over US sanctions delayed the listing plans.
SenseTime was among the first Chinese tech firms to receive government approval to publicly roll out its own ChatGPT-like services. However, its growth has slowed since the company was blacklisted by the US government in 2019 on accusations related to human rights violations in China’s far-western region of Xinjiang.
That has restricted its access to capital and crucial US tech components, which has been compounded in recent months by new curbs on the sale of advanced AI chips and chipmaking equipment to Chinese firms.
Shares in SenseTime are down about 38 per cent this year, giving it a market value of roughly US$5.9 billion. A critical report by short-seller Grizzly Research this week also weighed on the shares, as the US firm alleged SenseTime inflated its reported revenues. SenseTime has denied the allegations.
The company’s healthcare business focuses on offering AI-enabled diagnosis and treatment as well as hospital management platforms and medical research services for hospitals and medical institutions, according to its annual report.
The auto operation posted a revenue of about 293 million yuan (US$41 million) last year, accounting for around 7.7 per cent of the company’s total revenue. Its SenseAuto Cabin and SenseAuto Pilot products were adapted in 27 vehicle models with Nio and BYD among its main customers. Its advanced driving assistance system was delivered to flagship models of GAC Motor and Hozon New Energy Automobile.
