WeLab which filed an application in July to list on the Hong Kong stock exchange, will postpone its $500 million initial public offering, according to people with knowledge of the matter.
The online lender asked bankers to suspend preparation citing current market volatility, said the people, who asked not to be identified as the information is private. WeLab has no timetable for resuming the IPO work and may consider options such as seeking a new private funding round, one of the people said.
WeLab is delaying the offering amid a broad selloff in Hong Kong, where the benchmark Hang Seng Index has dropped almost 15 percent in 2018. The startup, which won backing from Credit Suisse Group AG and billionaire Li Ka-shing, had aimed to raise the money as early as this year, people with knowledge of the matter had said in 2017.
A WeLab representative declined to comment on the delay. The Hong Kong-based company, whose investors also include Malaysia’s Khazanah Nasional Bhd, Sequoia Capital and ING Bank NV, had picked Morgan Stanley and JPMorgan Chase & Co. as joint sponsors for the proposed IPO.
The fintech firm said in August it has sought a virtual banking permit from the Hong Kong Monetary Authority, which is poised to start granting licenses from the first quarter of 2019.