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IPO

IPO

China Renaissance completes first steps towards Hong Kong IPO, seeks up to US$400 million

The investment bank will begin the investor education phase next week, followed by roadshows in September

PUBLISHED : Thursday, 06 September, 2018, 11:47pm
UPDATED : Friday, 07 September, 2018, 3:12pm

Investment bank China Renaissance, a major investor in tech start-ups, has completed preliminary steps towards an initial public offering in Hong Kong, in which it is seeking to raise as much as US$400 million.

The firm, which filed its listing application in June, has passed the listing hearing and will begin pre-deal investor education next week, during which analysts discuss the company’s valuation with potential investors. That will be followed by a series of international roadshows starting in mid-September, according to several people familiar with the matter.

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The company is seeking a valuation of between US$3 billion and US$4 billion and is looking to raise between US$300 million and US$400 million, the people said. China Renaissance declined to comment.

Founded in 2004 by Bao Fan, a former Morgan Stanley and Credit Suisse banker, China Renaissance has advised on and invested in a number of high-profile mergers and acquisitions by Chinese technology start-ups, including those between Meituan and Dazhong Dianping and between Didi and Kuaidi, as well as the acquisition of Mobike by Meituan.

The company also served as the financial adviser on the upcoming IPO of Meituan Dianping, which is looking to raise up to US$4.4 billion on the Hong Kong market.

Bao controls around 63 per cent of China Renaissance. Neil Shen Nanpeng, founding and managing partner of Sequoia Capital China, owns 7.5 per cent while Li Shujun, founding and managing partner of Trustbridge Partners, holds 7.7 per cent.

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The prospectus showed the company’s adjusted revenue increased 48 per cent in 2017 to US$212 million. In the first quarter of this year, adjusted net profit reached US$35.67 million, a fivefold increase from the same period last year, thanks to growth in its investment banking and investment management businesses.

The company plans to use IPO proceeds to expand investment banking and investment management businesses, develop a private wealth management business, and invest in technology across its business lines.

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