China-based e-commerce company JD.com could raise up to $1.94bn when it floats in an initial public offering on Nasdaq that will value it at about $23bn.
The company will now issue approximately 215.5 million shares priced at between $8.00 and $9.00 each in what will be, until JD.com rival Alibaba floats later in the year, the largest ever IPO by a Chinese company.
Internet company Tencent acquired a 15% stake in JD.com in March this year for $215m. It currently holds 14.3% according to the filing, but has committed to boosting its share by another 5% through the offering, with other shareholders set to sell.
Software technology provider DST Global holds a 9.2% stake in JD.com, which will be diluted to 3.0% after it divests almost 6.8 million shares for a total of approximately $61.2m.
Other notable shareholders include Max Smart, an investment vehicle for company founder Liu Qiangdong Liu that holds 18.8%, and investment firm Tiger Global Management, which owns an 18.1% share. Altogether, external shareholders will be selling 49.4 million shares of the 215.5 million earmarked for the offering.
JD.com claims to be China’s largest online direct sales company in terms of transaction volume, with a 46.5% share of the market. It recorded net revenues totalling more than $11.4bn in 2013, resulting in a net loss of $8m.
The company expects to use $1bn to $1.2bn of the IPO proceeds to expand its shipping infrastructure base by acquiring land rights, build new warehouses and buy additional delivery vehicles.