GoGoX defies IPO drought as it pushes through downsized Hong Kong offering targeting US$85.5 million, down from US$500 million

The app-based logistics-services provider hopes to sell 31.2 million shares at HK$21.50 in a retail offering starting on Wednesday

The company will use the funds to accelerate international expansion, particularly in Southeast Asia

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GoGoX offers logistics services via apps. Photo: GoGoX

Published: 5:30pm, 14 Jun 2022

GoGoX Holdings, which provides logistics services through an internet platform, will kick off its initial public offering on Wednesday, seeking to raise up to HK$671 million (US$85.5 million), well short of its initial targets amid conditions that have led to an IPO drought.

The share sale by the Beijing-based firm comes amid a global dry-spell that has seen funds raised by leading IPO hubs such as Hong Kong and New York tumble by 90 per cent in the first half of the year.

The online intracity logistics platform is now aiming to sell 31.2 million shares at HK$21.50. Its retail offering will end Friday, and trading on the main board under the ticker “2246” is slated to begin on June 24.

“We see great demand for logistics, particularly after the Covid-19 outbreak,” said Steven Lam, the company’s co-CEO. “Business turned online while e-commerce [and] live streaming continued to blossom, and we feel that it is a good time for GoGoX to capture the new norm at this moment. The listing is vital to our further development.”

The Hong Kong Exchange Square building in Central, pictured in March 2020. A recent PwC forecast said Hong Kong IPOs in 2022 will generate 40 per cent less cash than last year. Photo: SCMP / Robert Ng

The company plans to use the funds to accelerate international expansion, particularly in Southeast Asia.

GoGoX, which counts Alibaba Group and its subsidiaries as shareholders, had originally attempted to tap the market in February with a higher target of US$500 million, but postponed the deal after the Hong Kong stock exchange asked for additional information, according to people close to the transaction. Alibaba owns the Post.