PE-backed China Literature raises $1.1b in HK IPO

China Literature sold 151.4 million shares at HK$55 apiece, the top of its marketed price range. The stock soared 90% on Tuesday morning, the first day of trading.

China Literature, which is 52.7% owned by Tencent, sells electronic books in a model similar to Amazon’s Kindle Store. China Literature’s store offered 9.6 million literary works from 6.4 million writers as of June.

The Carlyle Group and Trustbridge Partners own 9.5% and 4.2% respectively following the IPO. The PE firms first invested in the company in 2014 to support its $729.6 million acquisition of online publishing platform Cloudary, which had withdrawn from a US IPO the previous year citing unfavorable market conditions.

The Cloudary purchase significantly expanded China Literature’s audience, with the combined company accounting for 48.4% of China e-book downloads in 2016.

China Literature’s revenue grew from RMB1.6 billion ($236 million) in 2015 to RMB2.6 billion the following year. Over the same period, it went from a net loss of RMB354.2 million to a net profit of RMB30.4 million.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• IPO
• Technology
• Media
• China
• Hong Kong (China)
• TMT
• Tencent
• The Carlyle Group
• Trustbridge
• Exit