DouYu $775 Million IPO is The Largest Chinese Offering In US This Year

DouYu US Initial Public Offering
NASDAQ Marketsite on Time Square (Photo: Flickr.com / bfishadow)

Chinese live-streaming platform DouYu International Holdings has just become the largest Chinese IPO in the United States this year. The company had raised more than $775 million after it priced its share at the lower end of its intended range.

The streaming platform, heavily backed by Chinese tech firm Tencent Holdings, is actively selling around 67.4 million American depository shares (ADS) on the NASDAQ Global Select Market starting this week. Each of the company's ADS is being sold at $11.5 each, translating to a market valuation of over $3.37 billion. DouYu originally set its price range between $11.5 and $14 per ADS, with 10 ADS representing one share.

The company, which was originally founded in 2014 in China's Hubei province, will begin trading this week on the New York-based stock exchange, under the ticker symbol "DOYU." Assisting DouYu in its IPO are JPMorgan Chase, Morgan Stanley, Merrill Lynch, and CMB International Capital.

DouYu's IPO this week far exceeds the IPO of two other Chinese companies that went public in the United States in May. Starbuck's competitor in China, Luckin Coffee, listed on the NASDAQ, raising more than $561 million. Yunji, a social e-commerce service platform similar to Pindoudou, managed to raise around $121 million during its IPO in May.

DouYu first revealed plans to list in the US back in April, with the goal of reaching $500 million.

The company then announced that it would be delaying its planned IPO following the escalation of the trade war between China and the United States that trickled into the tech sector. In July, DouYu announced that it would be restarting its IPO plans, with the goal of raising up to $994 million. DouYu's IPO comes just a year after its closest rival Huya, which is also backed by Tencent, raised $180 million in its own IPO in the United States.

 The streaming service provider recently reported a stellar year, with net profits climbing to $2.65 million for the first three months of 2019. During its first quarter, DouYu reportedly attracted more than 160 million monthly active users across its different platforms. This was a 26 percent year-on-year increase for the company.

 DouYu did report a net loss of over $127.4 million last year, which was up from $89.12 million in 2017. However, the company's revenues have risen substantially, by up to 94 percent year-on-year. The drastic increase has been attributed to the company's continually growing user base, which currently stands at more than six million paying users.

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