Comprehensive M&A data with integrated detailed company information
Tencent wants to invest in Sea’s IPO
Posted on Thursday, 12 October 2017 13:49
Chinese powerhouse Tencent Holdings has made noises about taking part in the scaled down initial public offering of Sea, the eight-year-old southeast Asian games and ecommerce startup formerly known as Garena.
While the Cayman Islands-registered, Singapore-based Internet company got the ball rolling on a multi-million-dollar listing in the US earlier this year, the paperwork submitted to regulators was filed confidentially.
By September the technology unicorn unveiled a preliminary prospectus showing Goldman Sachs was lead left bookrunner of a sale of American depository shares (ADSs) on the New York Stock Exchange with a USD 1.00 billion placeholder.
However, last week Sea updated its statement to indicate 49.69 million ADSs offered at between USD 12.00 and USD 14.00 each, plus an overallotment for a further 7.45 million, could fetch up to USD 800.01 million.
Now Tencent, one of the principal shareholders with a 39.8 per cent pre-IPO stake, wants to get in on the action which reportedly may be a potential game-changer for southeast Asia’s expanding but underestimated technology industry.
It is interested in buying up to USD 100.00 million of the ADSs representing class A ordinary shares in the offering at the listing price and on the same terms as the other securities up for sale.
A potentially successful IPO would not only create a public market for the benefit of shareholders and employees but may prompt other technology companies in the region to attempt their own listing.
That is not to say Sea is not interested in any cash raised in the debut: it has already earmarked proceeds for business growth, including user acquisition, content procurement and research and development.
In the six months ended 30th June 2017, the group generated total revenue of USD 195.49 million (H1 2016: USD 166.69 million) and widened operating losses to USD 203.45 million (H1 2016: USD 125.34 million).
© Zephus Ltd