Meilishuo, a China-based fashion e-commerce company backed by internet company Tencent, is set to be acquired by social commerce company Mogujie, China Money Network reported today.
The transaction will consist of a 2:1 share swap and could value the merged company at approximately $3bn, though the size of the acquisition has not been officially confirmed.
The deal is being driven by investors of both companies, and local media reports indicate Tencent and Hillhouse Capital, the latter of which backs Mogujie and Meilishuo, could invest up to $250m in the merged entity, which would consider an initial public offering later this year.
Founded in 2009, Meilishuo operates an online marketplace focused on women. It sells fashion items such as clothes, shoes and handbags.
Meilishuo was reported in April 2015 to be looking to raise $300m in funding ahead of an initial public offering, but did not manage to secure the capital. It has not disclosed details of its later-stage rounds, but AllChinaTech reports it has raised about $250m in venture funding.
Tencent invested an undisclosed sum in Meilishuo’s 2012 series D round, which was reportedly followed in 2014 by funding from Hillhouse and venture capital firm GGV Capital.
The company received $20m in a 2011 series C round led by VC firm Sequoia Capital, with participation from GGV Capital, BlueRun Ventures and Zero2IPO Ventures, the investment arm of VC services firm Zero2IPO.
Mogujie’s shareholders include Ping An Ventures and Bertelsmann Asia Investments, which invest as subsidiaries of insurance firm Ping An and media group Bertelsmann, and IDG Capital Partners, an investment affiliate of media company International Data Group. It raised $200m in 2014 at a $1bn valuation.