Huami, China-based wearable device producer that counts electronics manufacturer Xiaomi as an investor, has raised $110m in an initial public offering in the US
The offering consisted of 10 million American depositary shares (ADSs) being issued on the New York Stock Exchange priced at $11.00 each, in the middle of the IPO’s $10 to $12 range.
Founded in 2013, Huami makes smart, wearable biometric devices that track a user’s physical activity, monitoring heart rate, steps, the length of their sleep, their weight or body fat composition. Its sole partner is Xiaomi, for which it creates products like watches or smart bands.
The company shipped 11.6 million devices in the first nine months of 2017 and its mobile apps have more than 49 million registered users in total. It made a $14.3m profit from $195m in revenue during that time.
Huami will put $29.7m of the proceeds toward research and development, and the same amount will support sales and marketing. The remainder has been earmarked for general corporate purposes or working capital.
The IPO follows $35m from venture capital firms Banyan Capital, Sequoia Capital and Morningside Capital in a December 2014 series B round that valued Huami at $300m. VC firm Xiaomi had invested as part of a smaller series A round earlier in the year.
Xiaomi held a 19.3% share of the company pre-IPO that was diluted to 15.1%. Shunwei Capital has not disclosed when it invested in Huami, but it had a 20.4% share that was reduced to 16.4%, while Banyan Capital’s 9.7% stake was cut to 7.9%.
HHtech Holdings, a vehicle for Huami chief executive Wang Huang and his family, is the company’s largest shareholder. Its 39.4% stake was diluted to 30.8%.
Credit Suisse Securities, Citigroup Global Markets and China Renaissance Securities are joint bookrunners for the IPO. They have a 30-day option to buy another 1.5 million ADSs, which would lift the size of the offering to just over $126m.
Huami’s shares opened at on Thursday and at time of publication are $11.38, giving the company a market capitalisation of approximately $676m.
– Photo courtesy of Huami Corporation.