Chinese lending firm Lexinfintech cuts US IPO size

HONG KONG: Chinese consumer lending firm Lexinfintech has slashed the size of its US initial public offering (IPO) by two-thirds to a maximum possible US$151.8mil, following a recent crackdown by Beijing on fast-growing online micro-lenders.

Lexinfintech, which focuses on loans to educated young adults between 18 and 36, including loans for online shopping, said in November it planned to raise up to US$500mil in an IPO on the Nasdaq.

China’s financial regulators are attempting to curb unwieldy growth at the nation’s online micro-lenders, unveiling tougher new rules over the past month including a ban on loans to borrowers who have no source of income.

In a US securities filing on Wednesday, Lexinfintech said it would sell 12 million American Depositary Shares at a price of between US$9 and US$11 each. The price range suggests an issue size of between US$108mil and US$132mil.

It said it could realise up to US$151.8mil from the offering upon exercise of over-allotment options and US$122.3mil after deducting expenses. The filing did not disclose when Lexinfintech will list.

When asked about the lower IPO size, Lexinfintech said in an email the US$500mil figure it cited in November was for the purpose of determining the registration fee and that the number of shares being offered and the price range had not been estimated then.