Kuaishou Technology, China’s main rival to ByteDance, is seeking to raise $ 5.4 billion in Hong Kong in what will be the world’s largest initial public offering since Uber Technologies Inc.
The short-lived video startup, backed by Tencent Holdings, is selling 365 million shares at Hong Kong $ 105 for $ 115 each according to the terms of the deal obtained by Bloomberg News. The company will start accepting investor orders from Monday to January 29th and is scheduled to be listed on February 5th.
Koisho has been trying to make the world’s largest Internet offering since Uber’s $ 8.1 billion sale of shares in May 2019, according to data compiled by Bloomberg. The IPO of the Chinese start-up will give another boost to the capital market, which was already hot in Hong Kong and could become the largest in Asia since the $ 5.8 billion buoyancy of Budweiser Brewing Co., APAC nearly two years ago.
Kuaishou, which means “fast hand” in Chinese, is one of China’s biggest success stories on the Internet in the last decade, part of a generation of startups that thrived backed by Tencent. Together with parent TikTok ByteDance, the outfit created in collaboration with Su Hua in 2013 pioneered the live streaming format and the biting video format that has since been adopted around the world by Facebook Ltd. Most recently at $ 180 billion.
Kuaishou’s IPO attracted 10 cornerstone investors, who agreed to subscribe for a $ 2.45 billion share, based on the midpoint of the marketed range. The lineup includes the Capital Group, Temasek Holdings Pte, GIC Pte, BlackRock Inc. And the Abu Dhabi Investment Authority, according to the terms, confirm an earlier Bloomberg News report. Cornerstone investors have agreed to hold shares for six months in exchange for an early and guaranteed allotment.
Kuyashu’s valuation could double after its issuance in Hong Kong. Leading pricing will cost the Chinese company $ 60.9 billion, compared to $ 28.6 billion it achieved in last year’s round of financing, according to Pitchbook. Even at the end of the low range, Koisho is still valued at $ 55.6 billion.
ByteDance has long been a candidate for IPO, but got into a fight last year against the U.S. ban on TikTok after the video service was labeled a threat to national security.
Koyaisho has had about 262 million active users daily since September, according to its prospectus. It’s still less than half of the 600 million doin, the Chinese version of TikTok. However, Koisho’s revenues climbed 49% to 40.7 billion yuan ($ 6.3 billion) in the first nine months of last year, after launching its monetization efforts through advertising and e-commerce. Although it offers free access to its main platform, the startup takes a snippet of the tips that users give to their favorite live streamers who perform viral challenges, sync lips to the latest pop songs and play video games.
Tencent owns about 21.6 percent of Kuyaisho shares, and other supporters include venture capital firms DCM, DST Global and Sequoia Capital China, the prospectus said. Tencent shares soared 6.4% to an all-time high in early Monday trading in Hong Kong.
Morgan Stanley, the Bank of America Corporation and China Renaissance Holdings are the joint sponsors of the deal.
(Except for the title, this story was not edited by the NDTV team and was published by a incorporated feeder.)