Baba Stock – Alibaba-Backed Huitongda Said to Weigh $1 Billion Hong Kong IPO
Huitongda Network Co., a Chinese e-commerce platform serving the country’s rural areas, is weighing a Hong Kong initial public offering that could raise as much as $1 billion, according to people familiar with the matter.
The company, which counts Alibaba Group Holding Ltd. among its backers, is working with advisers on the prospective listing and is considering going public as soon as the second half of this year, the people said, asking not to be identified as the information is private.
Deliberations are ongoing and details such as fundraising amount and timeline could still change, the people said. A representative for the company did not respond to phone calls or emails seeking comment.
The Nanjing-based firm empowers rural retailers with supply chain and digital technology, according to its website. Its network covers 21 provinces and over 19,000 towns and villages across China.
Huitongda’s IPO comes as online buying has boomed in the world’s second-biggest economy during the pandemic. E-commerce household names like Alibaba and JD.com Inc. have typically struggled to reach China’s more rural areas.
Alibaba, which has talked about expanding into lower-tier areas to boost small merchants and drive rural consumption, invested 4.5 billion yuan ($701 million) in Huitongda in 2018, a U.S. exchange filing shows. Accelerating the economic development of China’s countryside, where about 36% of its 1.4 billion-strong population lives, has long been a priority of Chinese President Xi Jinping.
Huitongda previously mandated Huaxing Securities for an IPO on Shenzhen’s ChiNext board, according to a filing with the China Securities Regulatory Commission in April.
First-time share sales have had a strong start in Hong Kong this year, boosted by ample liquidity and rallying stock markets at the beginning of 2021. Some $20.5 billion has been raised through IPOs in the Asian financial hub this year, more than six times the amount this time last year, data compiled by Bloomberg show.
— With assistance by Dong Cao, and Coco Liu