Tuanche, a China-based automotive e-commerce marketplace backed by media group Bertelsmann, has priced its shares at $7.80, settling on the lower end of its range and securing $20.3m in its initial public offering.
The company issued 2.6 million American depositary shares (ADSs). It had originally set a range of $7.50 to $9.50, targeting as much as $150m in proceeds.
Founded in 2010, Tuanche operates an e-commerce marketplace for cars and sells vehicles through its own public auto shows. The company has also built a virtual dealership service to connect automotive manufacturers with second-hand dealerships.
Tuanche claims to be the third largest e-commerce marketplace by volume in its home market, but suffered a $3.2m net loss in the first half of 2018, from $40.7m in revenue.
Half of the proceeds from its offering have been allocated towards a geographic expansion, with a third dedicated to enhancing IT and data analytics technology and the remainder going towards general corporate purposes.
Bertelsmann Asia Investments (BAI), a regional corporate venturing subsidiary of Bertelsmann, backed a $5.6m series B round in 2013 alongside venture capital firm K2VC, which had already supplied $700,000 in series A funding earlier that same year.
BAI returned in 2014 to contribute to a $27.6m series C round together with VC firm Highland Capital Partners, before the three existing shareholders joined AlphaX Partners for an $8.7m series C-plus round in June 2017.
Tuanche obtained $23.4m in series D funding from investment entities Acee Capital and Honour Depot in June this year, before adding $50m from Beijing Z-Park Fund Investment Center in September and $2.3m from Beijing Shengjing Fengtai Innovation Investment Center last month.
The company also secured $30m in convertible note financing from Lanxi Puhua in 2015 and another $6.3m in convertible note financing in August 2017 from AlphaX Partners, K2VC and Hongtao Investment.
BAI owned a 9.9% stake ahead of the offering, which has been reduced to 9.1%.
Tuanche’s other major shareholders are WW Long, a vehicle for chairman and CEO Wei Wen (from 19.1% to 17.5%), K2VC (from 14.1% to 13.1%), offshore trust Core Trust Company (from 13.4% to 12.3%), Highland Capital (from 10.6% to 9.7%), and First Aqua, a vehicle for investor Zhiwen Lan (from 5.7% to 5.2%).
Beijing Z-Park Fund Investment Center purchased approximately 10 million ADSs in the offering to increase its shareholding from 7.1% to 9.7%. BAI had also expressed an interest in purchasing shares in the offering, but does not appear to have done so.
Maxim Group and AMTD Global Markets are joint book-running managers for the offering.
