VC-backed Chinese package tour platform files for US IPO

The size and pricing of the issue have yet to be established and the regulatory filing does not indicate which investors plan to make partial exits.

However, it does disclose that DCM owns 23.5% of Tuniu, while Temasek, Gobi and Sequoia hold stakes of 16.7%, 16.4% and 13.2%, respectively. They collectively outweigh the management share, with co-founders Dunde Yu and Haifeng Yan holding 18.7% between them.

Tuniu's Series D round came last September as Temasek put in $50 million and DCM re-upped to the tune of $10 million. According to AVCJ Research, Gobi provided the Series A round in 2008 - two years after the company's launch - contributing $3 million. DCM joined Gobi in the second round in 2010, worth $10 million.

In 2011, Tuniu secured a $50 million Series C round as Highland Capital Partners, Japanese e-commerce firm Rakuten and Sequoia joined the investor roster.

Most travel e-commerce companies in China are essentially search engines that provide information on hotel and flight bookings plus a payment mechanism. Tuniu opted for a different tack, focusing specifically on packaged tourism, providing lead generation to the offline tourism agencies that have traditionally dominated the space.

The company claims to be the largest player in the online organized tours market by transaction value, having sold more than 3 million tours since inception. These are sourced from over 3,000 travel suppliers, covering 70 countries as well as attractions in China. Overseas leisure travel products and services contributed more than 70% of gross bookings in 2013.

The leisure travel industry in China, which primarily includes organized and self-guided tours, is expected to be worth RMB573 billion ($94.7 billion) by 2016, up from RMB394 billion last year, according to iResearch.

The online leisure travel market is projected to see compound annual growth of 35.6% to reach RMB75.5 billion by 2016, taking its share of the overall leisure travel industry from 7.7% to 13.2%.

Tuniu posted a net loss of RMB79.6 million in 2013, down from RMB107.2 million the previous year. Revenue rose from RMB1.1 billion to RMB1.9 billion over the same period but it continues to be offset by the cost of buying tour products from suppliers and other operating expenses.

Morgan Stanley, Credit Suisse and China Renaissance are joint bookrunners for the IPO.

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• Topics
• Consumer
• Greater China
• Exits
• Technology
• Venture
• TMT
• Consumer
• Exit
• IPO
• China
• Venture
• DCM-Doll Capital Management
• Temasek Holdings
• Gobi Partners
• Sequoia Capital