SenseTime IPO: Can you buy this stock if US blacklists this startup?

3 min read | December 11, 2021 12:16 AM AEDT | By Raza Naqvi

SenseTime IPO: Can you buy this stock if US blacklists this startup? — Image source: © Prykhodov | Megapixl.com

What's next for SenseTime IPO?

SenseTime IPO could be derailed in future as the United States will likely put the artificial intelligence startup on a trading blacklist. The government will likely place SenseTime on the list of Chinese military-industrial complex companies.

Human Rights Day is celebrated on December 10 and published reports suggest that the US Treasury could accuse SenseTime of supporting human rights violations.

Over the years, SenseTime has faced outrage over allegations that it is involved in human rights abuse against minorities in Xinjiang.

US could blacklist SenseTime

SenseTime is a famous company, and it was reportedly the most valuable AI startup in 2018. In addition, it is a member of Beijing's national AI team and generates hundreds of millions of dollars in revenue by providing its innovative technologies to several big companies.

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To proceed with the IPO, SenseTime will have to file an amended prospectus with the regulatory authorities as it would become necessary to mention the blacklist development in the prospectus so that the potential investors are aware of everything.

Notably, the AI startup's investors include big players like Alibaba Group Holding Ltd., Silver Lake, Primavera Capital, and Sailing Capital.

Earlier in 2019, the US authorities placed SenseTime on an export blacklist and this meant that the AI startup was banned from gaining access to some technologies being developed in the US.

Bottom line

American investors who were interested in SenseTime IPO will have to let it go if the IPO happens and the US puts it on the investment blacklist.

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According to rules, if a company is placed on the blacklist, then investors residing in the US are banned from investing.

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