Underwriters are rejecting mainland China and Hong Kong investor orders under the U.S. International Traffic in Arms Regulations ahead of the artificial intelligence firm's debut. The Claude maker has acknowledged growing U.S. scrutiny over Chinese state actors as a business risk, particularly while engaged in legal disputes over a Pentagon national security designation. To work around the ban, certain prospective buyers are deploying offshore vehicles, trusts, and swap arrangements to secure shares.
Key points
Geopolitical and defense trade regulations are actively limiting foreign capital access t…: Geopolitical and defense trade regulations are actively limiting foreign capital access to prominent artificial intelligence listings.
Anthropic faces persistent regulatory hurdles, including an active legal battle over a Pe…: Anthropic faces persistent regulatory hurdles, including an active legal battle over a Pentagon national security supply-chain risk designation.
Lead underwriters Goldman Sachs and Morgan Stanley have declined to comment on the exclud…: Lead underwriters Goldman Sachs and Morgan Stanley have declined to comment on the excluded regional share orders.
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While some prospective investors are continuing to pursue possible ways to bid, several banks have either refused to take those orders or consider it unlikely that they would be able to get allocations, said the people, asking not to be identified because the information isn’t public. The constraints were partly due to the US International Traffic in Arms Regulations, which control the trade of defense products, some of them said.
A representative for Anthropic declined to comment.
The situation echoes the $86.2 billion IPO of Elon Musk’s SpaceX, when underwriters were told not to accept orders from buyers in mainland China and Hong Kong, people familiar with the matter said, although investors in the two places were able to buy the stock after its listing. Anthropic’s products aren’t available in China and Hong Kong. The company recently blocked people traveling to those locations
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