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China's Meituan raises $4.2 billion, prices near top end of range - sources

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China's Meituan raises $4.2 billion, prices near top end of range - sources

China's Meituan raises $4.2 billion, prices near top end of range - sources
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Bobby Yip(Reuters)
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By Fiona Lau and Julie Zhu

HONG KONG (Reuters/IFR) - China's Meituan Dianping <3690.HK>, an online food delivery-to-ticketing services platform, priced its Hong Kong initial public offering near the top end of an indicative range, raising $4.2 billion (3.2 billion pounds) in the world's biggest internet-focused float in four years, people close to the transaction said on Thursday.

Meituan, backed by Chinese social media and gaming firm Tencent Holdings <0700.HK>, sold about 480 million primary shares, or 8 percent of its enlarged share capital, at HK$69 ($8.79) each, the people told Reuters.

They declined to be identified as details of the pricing have not been published yet.

Beijing-based Meituan didn't immediately respond to a request for comment on the pricing.

It set a price range of HK$60 to HK$72 per share on Aug. 31. The company could raise as much as $4.85 billion in total if a 15 percent "greenshoe", or over-allotment option, is fully exercised after the shares begin trading.

Meituan will use the IPO proceeds to fortify itself against stiff competition from its main competitor, food-delivery platform Ele.me which is backed by China's biggest e-commerce company Alibaba Group Holding <BABA.N>. Both parties are offering heavy discounts to attract new customers.

The IPO is one of the biggest in a packed Hong Kong listing calendar for the coming months, including an expected float of at least $3 billion from bitcoin mining equipment maker Bitmain and an IPO worth up to $1 billion from Chinese movie ticketing platform Maoyan Weying.

Hong Kong has seen a pickup in interest for listings following a market rally early this year and after the exchange introduced new rules designed to attract tech companies by allowing dual-class share structures.

Meituan's IPO is also the city's second multibillion-dollar tech float this year after Chinese smartphone maker Xiaomi Corp's <1810.HK> IPO of $5.4 billion.

But Hong Kong’s stock market has turned, with the benchmark Hang Seng index <.HSI> falling 20 percent from its January peak amid Sino-U.S. trade tensions, and several recent listings, such as Xiaomi's, have dropped below their IPO prices.

(Reporting by Fiona Lau of IFR, and Julie Zhu; Editing by Murali Anantharaman and Edwina Gibbs)

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