Best, a China-based logistics service backed by e-commerce group Alibaba, raised $450m yesterday in an initial public offering in the US.
The company priced 45 million American depositary shares on the New York Stock Exchange at $10 each, at the foot of the $10 to $11 range it had set. Alibaba had considered buying up to $150m of shares in the IPO but did not ultimately do so.
Best provides supply chain services such as warehousing and last-mile package delivery through third-party affiliates which use its technology platform. It serves more than 500 corporate customers as well as a range of small and medium-sized businesses.
Approximately $200m of the IPO proceeds will go to expanding Best’s logistics and supply chain services and e-commerce networks, while a further $65m will be used to strengthen its technology and grow the services it provides.
Best has raised at least $1.03bn in funding since it was founded in 2008, reportedly securing $15m from Alibaba and contract manufacturer Foxconn later the same year.
Alibaba has been a long-term investor, joining Walden International subsidiary PacVen Walden Ventures, Hina Group, Denlux Logistics Invest, Hong Kong Jiashi International Group and Orchid Development Holdings for a $20m round for Best in 2011.
The firm’s Alibaba Investment subsidiary contributed to Best’s $137.5m series E round in 2014, together with CDH Investments, an investor in the company since 2010, IDG-Accel China, Hina, Broad Street Principal Investments and Brackenhill Tower.
Alibaba Investment provided another $132.5m in 2015 and the corporate’s logistics subsidiary, Cainiao Smart Logistics, contributed to a $343m round in February 2016 as well as a $277m extension in April the same year.
Best’s largest shareholder Alibaba owned a 23.4% stake pre-IPO while Best founder and CEO Shao-Ning Johnny Chou held a 14.7% share. Other notable shareholders are Florence Star Worldwide (through a vehicle called CR Entities), IDG-Accel China Capital and Cainiao.
Citigroup Global Markets, Credit Suisse Securities (USA), Goldman Sachs (Asia), JP Morgan Securities, Deutsche Bank Securities, CLSA, KeyBanc Capital Markets, Oppenheimer & Co and Stifel, Nicolaus & Company are the underwriters for the IPO.
– This article was amended on September 22 to reflect Alibaba’s non-investment through the offering.