Inke, a China-based live video streaming platform backed by game developer Beijing Kunlun Tech, set the terms today for an initial public offering that could raise up to $167m.
The company will issue approximately 257 million shares on the Hong Kong Stock Exchange priced between HK$3.85 and HK$5 ($0.50 to $0.65). Roughly 30 million have been earmarked for Hong Kong investors and the rest for international buyers.
The underwriters will have the option to buy a further 45.3 million shares, potentially increasing the offering’s size to about $197m. Inke expects to begin trading on July 12.
Founded in 2015, Inke runs a live video broadcasting platform that enables users to buy virtual gifts for performers, who can convert the items to cash.
The company claims in the IPO filing that it had attracted almost 195 million registered users as of the end of 2017, though it has twice been fined by local regulators for broadcasting content deemed inappropriate.
Bilibili, the a China-based online entertainment platform that went public itself in March this year, has committed to purchasing $10m worth of shares in the offering.
Inke will use the IPO proceeds to diversify its product and content range, boost marketing activities, drive technology, research and development capabilities, and make strategic investments and acquisitions.
The company raised $47m in a July 2017 series B round featuring internet company Tencent’s Shenzhen Tencent subsididary as well as Jiaxing Guanglian, Jiaxing Guangmei, Ningbo Anhe, Ningbo Qingzheng, Mango Wenchuang and Zihui Juxin.
Mango Wenchuang subsequently divested its stock to Changxing Shengju, while Jiaxing Guanglian sold part of its shareholding to Chiyu Investment.
Inke had previously closed a $17.7m series A round in April 2016 that included $10.3m secured from Kunlun three months earlier as well as contributions from consultancy Shunya Interantional, GSR Ventures, SAIF Partners, Zihui Tianma and Zihui Juxin.
Cloud-based music platform Duomi Online had supplied $760,000 in angel funding for Inke in 2015. It owns a 14.6% stake that will be diluted to 12.4%, while Kunlun’s shareholding is set to drop from 10.2% to 8.7%. Tencent’s stake is lower than 5%.
China International Capital Corporation, Citi and Deutsche Bank have been hired as joint global coordinators for the offering while Haitong International Securities, BOCI Asia, HSBC and Futu Securities are joint lead managers.