trending Market Intelligence /marketintelligence/en/news-insights/trending/zalv_pjrz6v6d-wongpo9g2 content esgSubNav
In This List

Chinese online travel service Tongcheng-Elong cuts IPO size

Blog

Broadcast deal market recap 2021

Blog

Volume of Investment Research Reports on Inflation Increased in Q4 2021

Blog

Price wars in India: Disney+ Hotstar vs. Amazon Prime Video vs. Netflix

Blog

Using ESG Analysis to Support a Sustainable Future


Chinese online travel service Tongcheng-Elong cuts IPO size

Chinese online travel service provider Tongcheng-Elong Holdings Ltd. launched an IPO in Hong Kong that could raise up to US$233 million, far below its previously reported target, Reuters reported Nov. 13, citing a company term sheet.

Tongcheng-Elong, which counts China's Tencent Holdings Ltd. and Ctrip.com International Ltd. among its backers, applied for the IPO in June. Prior to that, the company was reported to be looking to raise US$1 billion to US$1.5 billion through a listing.

It is now offering approximately 143 million shares at a price range of HK$9.75 to HK$12.65, which could potentially value the company at US$3.65 billion, according to Reuters. Closure of the books is set for Nov. 19, with trading likely to start Nov. 26.

Tongcheng-Elong said in a prospectus that it intends to put proceeds from the IPO toward enhancements of its products and services, in addition to funding potential acquisitions and investments. The company also noted that it will use funds to grow its user base in the next 24 to 36 months.

In 2017, the company recorded 194.4 million Chinese yuan in profit, compared to losses of 2.16 billion yuan in 2016 and 963 million yuan in 2015.

Morgan Stanley Asia Ltd., JPMorgan Securities (Far East) Ltd. and CMB International Capital Ltd. are serving as joint sponsors for Tongcheng-Elong's IPO.

Tongcheng-Elong's decision to scale back its offering was prompted by weak markets as well as the declining share price of travel website operator Ctrip, the report said.

This comes about a month after it was reported that Tencent's streaming unit Tencent Music Entertainment Group decided to put its U.S. IPO plans on hold amid market concerns. The music business has not yet determined whether it will launch before year-end, according to Reuters.

Meanwhile, Reuters also reported that Alibaba Group Holding Ltd.-backed online parenting platform Babytree Group canceled a press conference that had been scheduled for Nov. 13 to discuss its planned Hong Kong IPO. Babytree reportedly said it had to be postponed due to a "technical issue."

As of Nov. 12, US$1 was equivalent to 6.96 Chinese yuan.