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Chinese fintech platform raises US$312m in US IPO

OneConnect's current US$3.7b valuation well below its US$7.5b mark of last year

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Ping An Insurance's OneConnect Financial Technology said on Thursday it raised around US$312 million in its US initial public offering (IPO), valuing the company at around US$3.7 billion.

New York

PING An Insurance's OneConnect Financial Technology said on Thursday it raised around US$312 million in its US initial public offering (IPO), valuing the company at around US$3.7 billion.

OneConnect sold 31.2 million American depositary shares (ADS) at US$10 each. Earlier this month, it had aimed to sell 36 million ADS at a price range of US$12 to US$14 per share, but on Wednesday it lowered the range to US$9 to US$10 and set a goal of selling 26 million ADS.

The US$3.7 billion valuation is well below its US$7.5 billion mark of last year when the company raised US$750 million in its maiden funding round from investors including Japan's SoftBank Corp and Japanese financial firm SBI Group.

The float comes as tech investor SoftBank still smarts from the abandoned share sale of major portfolio firm WeWork, as well as its first quarterly loss in 14 years, dragged down by an US$8.9 billion hit at its giant Vision Fund, through which it invested in OneConnect.

OneConnect had revenues of 1.55 billion yuan (S$300.8 million) in the first nine months of 2019, up 72 per cent from the year-ago period, but losses widened to 1 billion yuan from 579 million yuan.

In 2019, US investors have been reluctant to back companies going public with large losses, and shares of money-losing companies such as Uber and Lyft have struggled since their IPOs.

OneConnect, which provides technology solutions to small and medium-sized financial institutions, was eyeing a valuation of about US$8 billion and an IPO of up to US$1 billion, sources told Reuters in June.

It changed the listing venue to New York from Hong Kong a few months ago in the hope of achieving a higher valuation, Reuters reported, with massive anti-government protests in Hong Kong making markets jittery.

OneConnect is due to begin trading on Friday on the New York Exchange. Goldman Sachs, JPMorgan and Morgan Stanley are among the main banks working on the IPO. REUTERS