VC-backed Forgame raises $206m in HK IPO

Shares rose 5.78% in this morning's trading.

The Guangzhou-headquartered firm raised $206 million after pricing at HK$51 per share - close to the high end of the indicative price range of HK$43.5 to HK$55.0 apiece. The company set its IPO terms in the mid of September, planning to sell 31.37 million shares to raise up to $222 million.

Last year, TA Associates, Qiming Venture Partners and Ignition Capital Partners committed a combined $68.8 million in a Series A round of funding for Forgame. As of June 15, TA held a 20.1% stake while Qiming had 5.79% and Ignition held 1.77% in the company.

Founded in 2008, Forgame operates two game development brands, Feiyin and Jeiyou, and a publishing platform, Weidong. The company has a portfolio of 38 cloud-based multiplayer online games, including Ming Dynasty, Soul Guardians and Legend of Chaos. These titles were released through Weidong and via 100 other platforms under a joint-publishing model.

As of June, the game developer had attracted over 179 million registered players. Revenue rose to RMB776.6 million ($12.7 million) last year from RMB95.1 million in 2010. The company has turned a net loss of RMB40.4 million in 2010 to a net profit of RMB153.6 million for the first six months of this year.

More Chinese technology companies are considering to launch IPOs in Hong Kong. For Forgame, in part because local investors are more familiar with the Chinese online gaming market.

Alibaba Group wants the Hong Kong Stock Exchange (HKEx) to permit a bespoke IPO structure that would allow management to retain board control. However, it was at odds with HKEx traditional "one share one vote" system.

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• Topics
• Greater China
• Exits
• Hong Kong (China)
• Venture
• Qiming Venture Partners
• IPO
• TA Associates
• TMT