Hong Kong’s GoGoVan merges with 58 Daojia freight unit
Hong Kong-based GoGoVan, a VC-backed logistics start-up, and 58 Suyun, a freight unit of Chinese online-to-offline local services platform 58 Daojia, have agreed on an all-share merger that will create Asia’s largest online platform in the intra-city logistics business.
58 Daojia, also known as 58 Home, will hold a majority stake in the combined company, which will be worth more than $1 billion. The business will operate under the 58 Suyun brand in China and GoGoVan in Hong Kong and other Asian countries. Xiaohua Chen, the founder of 58 Daojai, will be the chairman of the merged entity, with GoGoVan founder Steven Lam serving as CEO.
58 Daojia launched 58 Suyun in September 2014. The platform offers on-demand delivery services via a mobile app that connects truck drivers with customers. Delivery fees are settled online. At present, 58 Suyun’s business covers more than 100 cities in mainland China, with over one million registered drivers.
58 Daojia, a subsidiary of US-listed classified site 58.com, provides information on and access to offline services. The platform received $300 million in funding from KKR, Alibaba Group and Ping An Group in 2015. The following year, 58 Daojia merged with Chinese manicure-booking app Dudumeijia.com to strengthen its competence in beauty services.
Launched in July 2013, GoGoVan offers similar on-demand delivery services as 58 Suyun. The firm expanded into Taiwan and Singapore in 2014 and then entered mainland China and South Korea in 2015. The platform has more than 180,000 registered drivers in 14 cities across six Asian countries. It has handled nearly 30 million orders since inception.
The Hong Kong-based company has raised three rounds of funding. Its Series A round, completed in 2014, was led by Singapore-based Centurion Private Equity. This was followed by a $10 million Series B in 2015, which featured Hu Zemin, the former CEO of Android app store 91 Wireless, and Chinese social media firm Renren. Last year, it raised a Series C round led by New Horizon Capital.
“The combined company will leverage 58 Suyun’s existing premium brand, large users base and online traffic for a quick expansion to 300 cities in mainland China. Meanwhile, by leveraging GoGoVan’s logistics expertise and business development experience in Southeast Asia, the combined company will further accelerate its growth in other Asia markets,” Lam said in a statement.
China's internet industry continues to consolidate across different verticals. Last week, Chinese food delivery ordering platform Ele.me merged with its rival Baidu Waimai in a deal that valued Baidu Waimai at around $800 million.
China Renaissance acted as exclusive financial advisor to both 58 Daojia and GoGoVan on the transaction.
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