Meituan Dianping, Chinese online food delivery-to-ticketing services company has reportedly raised $4.2 billion in the world’s largest internet-focused IPO in four years.
Tencent Holdings-backed Chinese firm sold about 480 million primary shares at HK$69 ($8.79) each in the Hong Kong IPO. This IPO valued the company at around $52.8 billion.
“Since the stock priced at the upper end of the range, it suggests institutions are holding a more positive view on the company and on this type of new economy IPOs,” said Steven Leung, sales director at brokerage UOB Kay Hian.
The funds collected by the company will help them to fortify itself against tough competition from its main competitor, food-delivery platform Alibaba-backed Ele.me. Both of these platforms, in a tough battle for market share, are offering heavy discounts to attract new customers and also to keep the existing ones.
The IPO received good support from institutional investors instead of a weak overall Hong Kong stock market. The sources tell that the institutional books were covered multiple times while the retail tranche was covered about 1.5 times.