Agora, a China-based video communication technology provider backed by quantitative trading firm Susquehanna International Group (SIG), will float on the Nasdaq Global Select Market today in a $350m initial public offering.
The offering will consist of 17.5 million American depositary shares (ADSs), each representing four ordinary shares, priced at $20.00 each, above the $18 to $20 range the company had set. The IPO price values it at $2bn.
Existing backers Coatue Management, Neumann Capital and an affiliate of Vitruvian Partners have agreed to buy $50m, $30m and $30m of shares respectively through a private placement concurrent to the IPO. Dragoneer Investment Group, has expressed interest in acquiring $50m but not confirmed a purchase.
Agora produces software that allows developers to add video engagement functionality to their applications enabling users to communicate with each other online through video in real time.
The company increased revenue from $13.4m in the first three months of 2019 to $35.6m in the equivalent period this year, though its net loss rose from $13.4m to $36.4m over the same period.
The offering comes after about $175m in funding including $50m in a February 2020 series C-plus round featuring Coatue Management, Shunwei Capital and Morningside Venture Capital, the IPO filing revealed.
SIG took part in a series C round alongside the same three investors in late 2018 that was sized at $66.7m according to the filing. Agora’s earlier investors include GGV Capital and IDG Capital.
Chairman and CEO Tony Zhou is the company’s largest shareholder and holds 19% post-IPO. Morningside owns 12%, Coatue 9.8%, SIG 9.7%, Shunwei Capital 7.8% and an investment representative of Xiaojing Li called Easy Dynamic International 5.6%.
Morgan Stanley and BofA Securities are lead bookrunning managers for the offering while Needham & Company is co-manager. They have the 30-day option to buy more than 2.6 million more ADSs which could increase its size to more than $402m.
