Ant Financial leads $321m round for China's Hellobike

The round comes six months after Ant Financial participated in a $350 million investment in the company. Two months before that, Hellobike merged with Youon Bike, which was already listed on the Shanghai Stock Exchange.

The latest deal, which values Youon at $1.47 billion, sees Ant Financial alone contribute RMB1.89 billion and increase its stake in the company from 27.6% to 36.7%. Youon’s interest has dropped to 8.85% from 10.3%. Other shareholders include: GGV Capital (7.11%), Joy Capital (3.15%), Bertelsmann Asia Investments (0.63%), Chengwei Capital (4.44%), Banyan Capital (1.11%), and WM Motor (1.36%).

Launched in 2016, Hellobike was a latecomer to the bike-sharing industry and therefore focuses on lower-tier cities, although its market share is still far behind that of Mobike and Ofo. The company has put more than five million bicycles on to the streets of 180 cities; it claims to have nearly 100 million registered users and average daily orders in excess of 10 million.

The company received a Series A round from GGV, Grains Valley Capital, Joy Capital and Bertelsmann Asia Investments in November 2016. Three months later, GGV led an extended Series A round for the company. Chengwei led a Series B round in April 2017, while WM Motor made a strategic investment the following June. Chengwei and other investors re-upped alongside Ant Financial last December.

Youon started in 2010 as an operator of government-backed bike rental schemes in small cities and entered the bike-sharing market in the second half of 2016. It has 800,000 bicycles in 32,000 service stations across more than 220 cities, with 20 million registered users. Ant Financial and Shenzhen Capital Group backed the company prior to its merger with Hellobike 

The listed entity, Youon Low Carbon Technology, had total assets of RMB3.65 billion as of year-end 2017. Revenue came to RMB128.5 million while the company posted a net loss of RMB488.9 million.

Earlier this year, Meituan-Dianping, China’s largest online-to-offline (O2O) local services platform, bought a controlling stake in Mobike at an equity valuation of $2.7 billion and assumed RMB4.5 billion in debt. Joy Capital was among the investors to profit from the deal, taking 90% of its interest in cash and the rest in shares. It stands to make an 11x money multiple on the investment.

To many, the acquisition signaled a strategic realignment of the bike-sharing industry. Tencent Holdings is a significant shareholder in both Meituan-Dianping and Mobike, while Alibaba and ride-hailing platform Didi Chuxing are backers of Ofo.

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