Date
21 October 2018
Menu icons are displayed on the Meituan application on a smartphone. Beijing-based Meituan Dianping is said to be planning a Hong Kong IPO at US$60 billion valuation target. Photo: Bloomberg
Menu icons are displayed on the Meituan application on a smartphone. Beijing-based Meituan Dianping is said to be planning a Hong Kong IPO at US$60 billion valuation target. Photo: Bloomberg

Meituan Dianping files for HK IPO; said to seek over US$4 bln

Meituan Dianping, a Chinese online food delivery-to-ticketing services platform, has filed for an initial public offering in Hong Kong, becoming the latest firm with a dual-class share structure to seek a listing under the territory’s new rules designed to attract tech companies.

The Beijing-based entity, which is backed by internet giant Tencent Holdings, did not detail the fund-raising target but Reuters cited sources as saying that the deal could be worth more than US$4 billion.

Meituan Dianping, which was valued at around US$30 billion in a fundraising round last year, is said to be aiming for a US$60 billion valuation with the IPO.

According to Reuters sources, Meituan Dianping is likely to list in October.

Founded in 2010 by serial entrepreneur Wang Xing, Meituan, likened to US discounting platform Groupon, completed a US$15 billion merger in 2015 with Dianping.

It offers a broad range of services including movie ticketing, food delivery, hotel and travel booking as well as ride-hailing.

Competitors include food-delivery platform Ele.me, backed by e-commerce firm Alibaba Group, and leading ride-hailing firm Didi Chuxing, backed by Japan’s SoftBank Group.

In its draft prospectus, which gave investors the first detailed look at its financial health ahead of the IPO, Meituan Dianping disclosed a 19 billion yuan (US$2.9 billion) loss for 2017, steeper than in the previous two years, Reuters reports.

Revenue rose to 33.9 billion yuan in fiscal 2017, sharply higher than the 12.99 billion yuan recorded in the prior year.

Meituan Dianping’s other backers include venture capital firms Sequoia Capital and DST Global, Singapore sovereign wealth fund GIC and state-owned investment company Temasek Holdings, as well as the Canada Pension Plan Investment Board.

Currently, Chief Executive Wang Xing owns 11.4 percent of the company, while Tencent owns 20.1 percent and Sequoia Capital 11.4 percent.

Wang will remain controlling shareholder after the listing, according to the prospectus filed with Hong Kong regulators.

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RC

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