JD Logistics seeks to raise up to US$3.4 billion in Hong Kong IPO

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JD Logistics, the delivery arm of Chinese e-commerce group JD.com, will seek to raise up to US$3.4 billion, which will be one of Hong Kong’s largest initial public offerings (IPO) this year.

The company decided to go public because of the boom in online shopping during the coronavirus pandemic.But one Tough regulatory environment A person familiar with the matter said that for the Chinese technology group, the recent drop in the stock price of SF Holding, one of JD Logistics’ biggest competitors, has caused the company’s IPO offer to fall by about a quarter.

JD Logistics will sell 609.2 million shares at a price of 39.36-43.36 Hong Kong dollars (5.07-5.58 US dollars) per share. According to the trading terms seen by the Financial Times, the final price will be set on Friday, and the stock is expected to begin trading on May 28.

The IPO will be the second largest IPO in the city this year, second only to KuaishouChina’s viral video application, which raised US$5.4 billion in February this year, will become the third blockbuster of JD’s listing in Hong Kong in the past year.JD Health, which sells medicines and healthcare services online, has completed a $4 billion IPO in December And JD.com launched its own Secondary listing A similar amount was raised in Hong Kong in June last year.

According to Bloomberg data, in recent months, a large number of Chinese technology companies have been listed, which has benefited Hong Kong a lot. Since the beginning of this year, Hong Kong has conducted more than US$20 billion IPOs.

JD.com (JD.com) created the logistics and delivery department in 2007 and split it into independent departments ten years later. The company has more than 900 warehouses in China and provides delivery and warehousing services to third parties.

However, as China’s censorship of its largest Internet group has become increasingly stringent, the group is under pressure. Last month, officials told the country’s 13 largest technology companies, including JD.com (JD.com), Tencent and ByteDance’s fintech subsidiaries, “Correct outstanding problems” On their platform. After the financial technology company’s $37 billion initial public offering (IPO) was frustrated in November last year, this move was seen as a sign that the regulator’s focus on the field has expanded to Jack Ma’s ant. Outside the Ant Group.

In addition, the shares of SF Holding, China’s largest listed and delivery company, fell sharply last month after the company suffered quarterly losses and triggered a review of the high valuation of Chinese companies.

“The competition in China’s logistics sector is very fierce, especially in [Indonesian company] J&T Express entered the market, which has had an impact on the performance of other logistics companies and will hit JD.com. Said Li Chengdong of Haitun, an e-commerce think tank.

JD Logistics was originally the delivery department of the JD.com e-commerce website, but more and more of its business comes from delivering packages on behalf of third parties.

According to the terms of the transaction, the cornerstone investors of JD Logistics’ IPO, including technology group Softbank’s Vision Fund, Temasek Holdings, investment companies backed by the Singapore government, and investment companies Tiger Global and Blackstone Group, have subscribed for approximately US$1.5 billion in stocks. .

Bank of America, Goldman Sachs and Haitong International are the co-sponsors of this listing.

Other reports by Ryan McMorrow in Beijing

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