Yixin Group, the China-based e-commerce marketplace operator spun out of automotive transaction services provider BitAuto, raised HK$6.77bn ($867m) in its initial public offering yesterday.
The company issued almost 879 million shares on the Hong Kong Stock Exchange priced at the top of the IPO’s HK$6.60 to HK$7.70 range. Its stock opened at HK$10.00 yesterday and briefly reached HK$10.18 before closing at HK$8.12, giving it a market cap of about $6.54bn.
Yixin runs an online platform that functions as a marketplace for vehicles, and also operates a financial services operation that provides leasing as well as financing for car purchases.
About 30% of the IPO proceeds will support sales and marketing, 20% will go to research and technology as Yixin looks to upgrade its IT systems and data analytics capabilities, 20% will be put into strategic deals and another 20% will fund the expansion of its financing business.
BitAuto joined internet group Tencent and e-commerce firm JD.com to invest a reported $390m in Yixin in 2015, the year after spinning it out. All three investors participated in the company’s $550m series B round in August 2016 alongside internet company Baidu.
BitAuto, Tencent, state-owned asset manager China Orient AMC International and private investor Wei Wang subsequently participated a May 2017 funding round subsequently revealed to be $505m in size.
The underwriters for the IPO – UBS, UBS Hong Kong, China Merchants Securities and CLSA – can buy almost 132 million extra shares through an over-allotment option that could potentially increase the size of the offering to about $1.07bn.
The IPO comes just days after Tencent scored another exit, spinning out its China Literature online reading platform in a $1.1bn IPO last week that also took place in Hong Kong.