Tencent Holdings-backed online Chinese travel firm Tongcheng-Elong launched a far smaller-than-expected initial public offering of up to USD 233 million in Hong Kong on Tuesday, amid a weak stock market and a string of poor performances from recent listings in the city, Reuters reports.
Tongcheng-Elong, which is also backed by travel website Ctrip.Com International, is selling about 143 million shares at a price range of HK$9.75 to HK$12.65 (USD 1.24- USD 1.61), giving it a potential valuation of USD 3.65 billion, according to a term sheet seen by Reuters.
The company had earlier been seeking to raise up to USD 1 billion, but weak markets and a slide in Ctrip’s share price forced it to slash the size of the IPO, according to Refinitiv publication IFR.
Books are scheduled to close on November 19 and the company is expected to start trading on November 26.
Tongcheng plans to use the proceeds of the IPO to enhance products and service offerings as well as to fund potential acquisitions and investments.
The company made a profit of RMB 194 million (USD 27.86 million) in 2017, compared with a loss of RMB 2.16 billion in 2016, according to its prospectus.
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