OneConnect Financial Technology, a Singapore-based financial services platform developer formed by insurance group Ping An, has raised $312m in an initial public offering on the New York Stock Exchange.
The company issued 31.2 million American Depositary Shares (ADSs), each representing three ordinary shares, priced at $10.00. Its ADSs briefly peaked at $10.71 on their second day of trading on Friday, before closing back down at $10.00, giving it a market capitalisation of $3.61bn.
OneConnect was created as the financial technology arm of China-headquartered Ping An and spun off in 2017 to commercialise an artificial intelligence-based cloud software platform that helps financial services providers, insurance companies and asset management firms with digital transformation.
Customers can use the platform to support the move to digital technologies in areas such as risk and operations management, sales and marketing, and product development, improving service quality, reducing costs and boosting sales productivity.
OneConnect raised $750m from investors including financial services firm SBI and its SBI Stellars Fintech Fund partnership, telecommunications and internet group SoftBank’s Vision Fund and Oceanwide Financial Technology, part of property developer Oceanwide Holdings, in early 2018 according to the IPO prospectus.
Entities known as FinTech Business Innovation, Jumbo Sheen Fintech Investment, Bocomi Hermitage Global Fintech Fund, Fangyuan Investment Management, Huateng Fintech and Bloom Vast Limited also contributed to the round.
Approximately $93m of the IPO proceeds has been allocated to platform and technology development, while $34.9m will go to international expansion efforts and strategic investments and $23.3m to sales and marketing activities.
Ping An’s 39.7% stake in the company has been diluted to 36.6% following the offering, though the corporate spent $30m to purchase 3 million additional shares as part of the IPO through a vehicle called Bo Yu.
Other notable shareholders in OneConnect are Sen Rong, a holding company that includes stock set aside under OneConnect’s share option plan, and a vehicle named Rong Chan that is controlled by five Ping An employees. Sen Rong’s 49.9% stake has been reduced to 45.7% while SBI Stellars holds a 5.6% stake post-IPO.
Morgan Stanley, Goldman Sachs (Asia), JP Morgan Securities and Ping An of China Securities (Hong Kong) are joint book-running managers for the offering while Bank of America Securities and HSBC Securities (USA) are passive joint bookrunners and CLSA and KeyBanc Capital Markets are co-managers.
The underwriters have been granted a 30-day option to buy up to 4.68 million additional ADSs which would boost the proceeds from the offering to more than $358m.
