China's PE-backed Weimob applies for HK IPO

Financial details of the offering, and whether existing investors will sell any shares, have not been disclosed. According to its prospectus, Weimob plans to use about 30% of the proceeds for improving its research and development capability and its technology infrastructure, with another 25% designated for strategic cooperation, investments and acquisitions that can expand the company’s produce and service offerings. It will use another 35% of the proceeds for sales and marketing initiatives.

Launched in 2013, Weimob creates software to help small and medium-sized enterprises (SMEs) build their online presence, primarily through Tencent’s Wechat platform. Merchants use the products, which are available on a software-as-a-service (SaaS) basis, to build personalized storefronts and manage their digital commerce operations including product display, order and payment processing, customer relationship management, and social media outreach.

For the year ended December 2017, Weimob reported RMB534 million ($78 million) in revenue, up from RMB189 million the year before. Over the same period the company went from a net loss of RMB80.9 million to a net profit of RMB2.6 million.

China’s Meridian Capital was an early investor in Weimob, along with Tencent Mobility. The investors committed two funding rounds in 2015 totaling more than RMB650 million. In a pre-IPO round earlier this year Weimob raised more than $321 million from a consortium including UOB Venture Management, SIG Asia Investments, Singapore’s GIC Private, and a number of other investors.

This year has seen a number of Chinese technology companies launch offerings in Hong Kong, thought the largest of these, smart phone maker Xiaomi, came in well below expectations. The company raised HK$37 billion last month at a valuation of $54 billion, but was said to be targeting a $10 billion offering and a $100 billion valuation.

Xiaomi’s IPO has raised questions about the prospects for other companies looking to list in Hong Kong under a recently altered IPO regime intended in part to attract tech firms. These include Meituan-Dianping, China’s leading online-to-offline platform, which filed for its IPO in June and is reportedly seeking to raise more than $4 billion at a $60 billion valuation.

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• Topics
• Greater China
• IPO
• Technology
• Support services
• Hong Kong (China)
• Tencent
• TMT
• Exit
• GIC Private
• UOB Venture Management
• Susquehanna Asia Investment