China's PE-backed internet finance firm VCREDIT raises $152m in HK IPO

2018-06-201451

Source:Dealer Street

VCREDIT, an independent online consumer finance service provider in China, has raised HK$1.19 billion ($152 million) in its IPO in Hong Kong after selling 78.7 million shares at HK$20 each, the lower end of its offer price range, according to its filing Wednesday. The fund raised was lower than the company’s original target net proceeds of approximately HK$1.36 billion when it filed its prospectus early this month.

VCREDIT is backed by private equity firms, including TPG Capital. The company raised $50 million in a Series C funding round in October 2017 led by Singapore-based TPG Growth III SF Pte Ltd. The final number of offer shares under the Hong Kong Public Offering is 6,857,200 shares, representing approximately 10 per cent of the total number of offers shares initially available under the global offering. The shares offered under the International Offering were oversubscribed at the final office price. The final number of shares under the International Offering was 71,818,400 shares. VCREDIT, which mainly provides credit card balance transfer products, consumer credit products, and online-to-offline credit products, said it will use the proceeds of its offering to further strengthen the capital base of its subsidiaries, further enhance its research and technology capabilities, and for general corporate purposes.

According to a Frost & Sullivan Report, VCREDIT is one of the top 10 independent online consumer finance service providers in China as of December 31, 2017. The company said its KK Credit product line also ranked No. 1 in China's credit card balance transfer market with an approximately 16.4 per cent market share, both in terms of the balance of outstanding principal of loans. "We build and expand our online consumer finance business upon our belief that finance is the core of financial technology and that risk management is the core of finance," the company said. According to its prospectus, VCREDIT's total loan volume reached of Rmb3.53 billion ($557 million) in 2015, Rmb7.87 billion ($1.21 billion) in 2016, and Rmb24.54 billion ($3.8 billion) last year, with the compound annual growth rate of 163.7 per cent, the prospectus showed. Its revenues reached Rmb1.06 billion ($164 million) in 2015, Rmb1.43 billion ($221 million) in 2016, and Rmb2.71 billion ($419 million) last year, with the compound annual growth rate of 59.6 per cent. Its net losses were Rmb300 million ($46 million), Rmb570 million ($88 million), and Rmb1 billion ($154 million), respectively.

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