HONG KONG • Kuaishou Technology, the operator of China's most popular video service after ByteDance's Douyin, is seeking to raise as much as US$5.4 billion (S$7.2 billion) in the world's biggest Internet initial public offering (IPO) since Uber Technologies.
The short video start-up, backed by Tencent Holdings, is selling 365 million shares at HK$105 to HK$115 each, according to terms of the deal obtained by Bloomberg News. The company was to start taking investor orders from yesterday to Friday and is slated to list on Feb 5 in Hong Kong.
Kuaishou is attempting the world's biggest Internet IPO since Uber's US$8.1 billion US share sale in May 2019, according to data compiled by Bloomberg. The Chinese start-up's IPO will give another boost to Hong Kong's already-hot capital market and could become Asia's largest since the US$5.8 billion float by Budweiser Brewing's Apac almost two years ago.
Kuaishou, which means "fast hand", is one of China's biggest Internet success stories of the past decade. Along with TikTok parent ByteDance, the outfit co-created by Su Hua in 2013 pioneered the live streaming and bite-size video format that has since been adopted around the world by the likes of Facebook.
Tencent and IPO adviser China Renaissance Holdings surged in Hong Kong, suggesting enthusiasm for its upcoming debut. Yesterday, Kuaishou executives revealed monthly active users on its main app had reached 481.4 million while average daily time spent had crossed the 100-minute mark in 2021.
Kuaishou's offering has attracted 10 cornerstone investors, which agreed to subscribe for US$2.45 billion of stock, based on the mid-point of the marketed range. The line-up includes The Capital Group, Temasek, GIC, BlackRock and Abu Dhabi Investment Authority, the terms show, confirming an earlier Bloomberg News report.
The cornerstone investors have agreed to hold stock for six months in exchange for early, guaranteed allocation.
The valuation of Kuaishou could more than double after its Hong Kong IPO. A top-end pricing will value the Chinese firm at US$60.9 billion, up from the US$28.6 billion it achieved in a funding round last year, according to Pitchbook. Even at the low end of the range, Kuaishou will still be valued at US$55.6 billion.
Kuaishou had about 262 million average daily active users as at September, according to its prospectus. That is still fewer than half the 600 million on Douyin, the Chinese version of TikTok.
That said, Kuaishou's revenues climbed 49 per cent to 40.7 billion yuan (S$8.3 billion) in the first nine months of last year, after it ratcheted up monetisation efforts through advertising and e-commerce.
BLOOMBERG
