Ten­cent-backed app to seek IPO that val­ues it at US$4bil

The Star Malaysia - StarBiz - - Digital Trend -

HONG KONG: Yet an­other Chi­nese tech­nol­ogy com­pany is headed for an ini­tial pub­lic of­fer­ing.

Meil­ishuo, the on­line fash­ion re­tailer backed by Ten­cent Hold­ings Ltd, is in talks with sev­eral in­vest­ment banks about a US ini­tial pub­lic of­fer­ing that could value the startup at about US$4bil, ac­cord­ing to peo­ple fa­mil­iar with the mat­ter.

The women-fo­cused on­line re­tailer hosted a bake-off to dis­cuss IPO prospects with po­ten­tial ad­vi­sors and un­der­writ­ers, the peo­ple said, ask­ing not to be iden­ti­fied talk­ing about pri­vate ne­go­ti­a­tions.

Meil­ishuo, which merged with ri­val Mogu­jie in 2016 to form a com­pany with US$3bil in sales, was said to have been val­ued at US$3bil at the time of that deal.

The com­pany, whose name means “Beauty Talk,” is one of the more pop­u­lar fash­ion and cos­met­ics re­tail­ers on­line, a niche it’s clung to de­spite the dom­i­nance of Alibaba Group Hold­ing Ltd and JD.com Inc. Meil­ishuo’s en­vi­sioned US$4bil val­u­a­tion is an ini­tial tar­get and could change if a deal pro­ceeds, the peo­ple said.

It’s one in a grow­ing wave of Chi­nese tech­nol­ogy com­pa­nies look­ing to sell shares to the pub­lic.

Smart­phone maker Xiaomi Corp is seek­ing a val­u­a­tion of as much as US$100bil in a much-an­tic­i­pated of­fer­ing, peo­ple fa­mil­iar with the mat­ter have said, while Meituan Dian­ping, a Chi­nese food re­view and de­liv­ery giant also backed by Ten­cent, has be­gun dis­cus­sions about a Hong Kong IPO at a valua- tion of at least US$60bil.

“Ten­cent wants to de­velop e-com­merce via its part­ners, so Meil­ishuo could get a lot of re­sources and help,” said Li Yu­jie, an an­a­lyst with RHB Re­search In­sti­tute Sdn in Hong Kong.

“It still de­pends on how the over­all mar­ket per­forms, but e-com­merce sec­tor-wise it would be a good year to fetch a good val­u­a­tion.”

Meil­ishuo, which didn’t re­spond to re­quests for com­ment, was said to have con­sid­ered a US list­ing as early as two years ago.

Most of China’s largest tech cor­po­ra­tions have picked New York for their de­buts, seek­ing the wide in­vestor base and higher in­ter­na­tional pro­file that an Amer­i­can list­ing con­fers.

Bei­jing how­ever is now en­cour­ag­ing many of those same firms to also list shares on Chi­nese ex­changes.

Founded in 2009, Meil­ishuo runs an on­line mar­ket­place sell­ing clothes, shoes and hand­bags. — Bloomberg

E-com­merce giant: A Ten­cent sign is seen at a con­fer­ence in China. Meil­ishuo, the on­line fash­ion re­tailer backed by Ten­cent Hold­ings Ltd, is in talks with sev­eral in­vest­ment banks about a US IPO. — Reuters

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