Sina Weibo, the China-based microblogging website in which China-based e-commerce company Alibaba holds a 19.3% stake, has filed for a US initial public offering that could raise up to $500m.
Owned and operated by Chinese internet company Sina Corporation, Weibo runs an online service similar to Twitter’s, also utilising a 140-character limit and allowing users to re-post or hashtag their messages. Users can also attach images, music or emoticons to their posts. As of the end of 2013, it had 129.1 million monthly active users and averaged 61.4 million daily active users.
Alibaba invested $585.8m for an 18% stake in Weibo in May 2013 through subsidiary Ali WB Investments, with the option to increase its share in the company to 30%. The filing did not detail any plans by Alibaba to divest any of its stake through the offering.
Alibaba’s payment subsidiary, Alipay, subsequently launched a payment system through Weibo in January this year, and Weibo said in the filing that it expects to “generate a significant portion of our advertising and marketing revenues from our strategic alliance with Alibaba,” including RMB 2.3bn ($371m) in advertising and marketing revenue between 2013 and 2015.
Weibo intends to use $250m of the proceeds from the IPO to repay money borrowed from Sina, and will invest the rest in developing its products and infrastructure, and in expanding its sales and marketing.
Goldman Sachs (Asia) and Credit Suisse (USA) will act as underwriters for the offering.
Sina previously floated on NASDAQ in 2000, raising $76.5m, and Alibaba itself will be paying close attention to the interest around Weibo’s IPO, having revealed recently that it plans to raise roughly $15bn from an IPO on the US markets later this year.