HONG KONG (BLOOMBERG) - Chinese on-demand logistics and delivery firm Lalamove is considering shifting its planned US$1 billion (S$1.36 billion) United States initial public offering (IPO) to Hong Kong, sources familiar with the matter said, as regulators in its home country crack down on the wave of firms chasing overseas listings.
The company, which filed confidentially for a US IPO last month, is weighing a venue switch amid concerns about the uncertainty created by Chinese regulators' proposed new rules, the sources said, asking not to be identified as the information is private.
While it is not clear whether companies such as Lalamove would be prevented from listing in the US, the firm is keen to avoid a lengthy delay in going public, the sources said.
Deliberations are ongoing and Lalamove could still decide to proceed with its US IPO, they said. A representative for Lalamove said the firm continues to pay attention to capital markets but has no specific timeline and venue for an IPO.
The fallout from the US$4.4 billion US IPO by China's Didi Global has thrown listing plans into disarray, after Chinese regulators barred the company's software from app stores and proposed new rules for similar firms listing overseas. The regulations would require companies with over one million users' data to submit to a cyber security review.
Lalamove would be among the first firms that have filed confidentially in the US to re-route to Hong Kong as a result of China’s regulations tightening. Several have scuppered their plans already, starting with LinkDoc Technology which pulled a New York float the day it was expected to price, Bloomberg News reported. Chinese fitness app Keep chose not to proceed with its filing, according to the Financial Times, and vegetable delivery app Meicai put its listing on hold, the South China Morning Post reported.
Bankers expect the majority of Chinese IPOs aimed for American exchanges to either get suspended or diverted to other venues, including the Asian financial center. But listing requirements in the financial hub or mainland China are more stringent, making deals there far from certain.
Founded in 2013, Lalamove provides van-hailing and courier services on demand. It operates in over 20 markets across Asia, Latin America and the US with a pool of more than 700,000 driver partners, according to its website. In December, the company raised US$515 million from investors including Sequoia Capital China, Hillhouse Capital and Shunwei Capital.