Orchid Asia-backed Autohome sets terms for $126m US IPO
Autohome, a Chinese online automobile marketplace in which Orchid Asia is an investor, plans to raise up to $125.9 million through an IPO on the New York Stock Exchange. The private equity firm will not be exiting any shares through the offering.
According to a regulatory filing, Autohome will sell as many as 8.99 million American Depository Shares (ADS) at $12-14 apiece. The proceeds will be used for product development, expanding sales and marketing channels and repurchasing shares from a former director, as well as for general corporate purposes.
Australia's Telstra is the largest shareholder in Autohome, with a 71.5% interest. AVCJ Research's records show that Telstra bought 55% of the company in 2008. It increased its holding to 66% in 2012 and has agreed to pay $55 million for 2.8 million shares as part of the share buyback, taking it up to 71.5%. Telstra's stake will fall to 66.2% post-IPO.
Orchid also invested in Autohome in 2008 via Orchid Asia III, a 2005 vintage vehicle with a corpus of $181 million that is now fully invested. The PE firm holds a 12.5% stake in the company, which will fall to 11.7% post-IPO.
Autohome operates two websites - autohome.com.cn and che168.com - and claims to be the leading online destination for car buyers in China.
According to iResearch, autohome.com.cn was the country's top-ranked automotive internet portal by average daily unique visitors for the nine months to September 2013. During this period it accounted for approximately 46% of the total time spent by Chinese internet users viewing online automotive information, more than four times that of its closest competitor.
The company generates the bulk of its revenues from online advertising and dealer subscription services. Autohome reported a net income of RMB333.5 million ($54.5 million) for the nine months ended September 2013, up 96.7% year-on-year, while revenues jumped 62.6% to RMB830.6 million.
China is the world's largest passenger car market by sales volume, according to LMC Automotive. A total of 14.2 million units were sold in 2012 and the figure is expected to reach 20.7 million by 2015. The country also has the world's largest internet population, with 590.6 million users as of June 2013.
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