Traders at work on the floor of the New York Stock Exchange in New York. [Photo / for China Daily]

NEW YORK - Youku.com Inc, China's biggest online video company, said it plans to raise $169 million in an initial public offering in the United States, one week after its competitor Tudou Holdings Ltd filed for its own initial public offering (IPO).

Youku.com will offer 15.4 million American depositary receipts (ADR) at $9 to $11 each, the Beijing-based company said in a filing with the Securities and Exchange Commission. Proceeds will be used to upgrade technology, buy videos and expand sales and marketing, the prospectus said. Shanghai-based Tudou, China's second-largest provider of online videos, filed on Nov 9 to sell $120 million of shares in the US.

The two companies are raising money after the number of Internet users in China surpassed the entire US population. Four of this year's 10 best-performing IPOs on New York exchanges are from companies based in China, where the economy is forecast to expand more than four times as fast as the US in 2011, according to the International Monetary Fund. Sales at Youku.com and Tudou have each more than doubled this year.

"It provides another opportunity for investors seeking high-growth exposure to the Chinese marketplace," said Josef Schuster, the Chicago-based founder of IPOX Capital Management LLC, which oversees $3 billion. "The story is driven by the growth prospects and the underlying economy."

Goldman Sachs Group Inc of New York is leading Youku.com's offering, the prospectus said.

Internet users

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China had an estimated 420 million Internet users at the end of June, according to data from the government-sponsored China Internet Network Information Center. The US population is about 311 million, according to the Census Bureau's website.

China's online video market more than doubled to 621 million yuan ($94 million) in the third quarter, according to Beijing-based research company Analysys International.

Youku.com had the largest share at 23 percent, followed by 19 percent for Tudou. Google Inc's YouTube, the world's most popular video site, is inaccessible in China.

Youku means "excellent and cool" in Chinese. The company had previously raised $110 million from investors, including Chengwei Ventures, Brookside Capital, Maverick Capital and Sutter Hill Ventures. Its last round of private equity funding from existing investors raised $40 million in December.

Revenue at Youku.com increased 135 percent to 234.6 million yuan in the first nine months of 2010, according to its filing, while Tudou's sales more than tripled. Neither company has been profitable in the past three years.

Youku.com's ADRs, each representing 18 Class A ordinary shares, will trade on the New York Stock Exchange under the ticker YOKU, according to the filing.

Bloomberg News