Chinese online services company Meituan-Dianping is set to launch its Hong Kong IPO that aims to raise up to US$4.5 billion, The Wall Street Journal reported Sept. 3, citing people familiar with the matter.
The company will reportedly offer shares at a price range of HK$60 to HK$72 per share, and the public stock sale could value it at around US$55 billion.
Tencent Holdings Ltd., a major backer of Meituan with more than 20% stake, has agreed to commit US$400 million to the IPO, while financial investor OppenheimerFunds Inc., committed US$500 million, according to the report.
A third of the offering size, or US$1.5 billion of the IPO shares will be bought by global and local money managers, said a person familiar with the development.
Meituan's shares are expected to start trading in Hong Kong Sept. 20.
Tencent previously led a funding round which raised US$4 billion and valued the company at US$30 billion in October 2018.
Other cornerstone investors of Meituan include Lansdowne Partners Ltd., Darsana Capital Partners LP and an investment fund controlled by China Chengtong Holdings Group Ltd.
According to the WSJ report, the Beijing-based company posted a nearly 19 billion yuan loss while revenue more than doubled to 33.9 billion yuan in 2017.
Goldman Sachs Group Inc., Morgan Stanley and Bank of America Merrill Lynch are the lead banks handling the offering.
A public listing could help boost Meituan's push to invest in offline retail and artificial intelligence technology.
As of Sept. 3, US$1 is equivalent to 6.82 Chinese yuan.