HONG KONG (Sept 7): Meituan Dianping, the Chinese restaurant review and delivery giant, has attracted Hong Kong tycoon Li Ka-shing to an initial public offering that could raise as much as US$4.4 billion, people with knowledge of the matter said.
Li, who is Hong Kong’s richest man, is planning to buy stock in the offering in his personal capacity, according to the people, who asked not to be identified because the information is private. Thomas Lau, the chairman of department store operator Lifestyle International Holdings Ltd, is also preparing an investment, the people said, without specifying the amounts.
Meituan Dianping started taking orders earlier this week for what is set to be one of Hong Kong’s biggest IPOs of 2018. Five cornerstone investors, including existing backer Tencent Holdings Ltd, have agreed to buy a combined US$1.5 billion of stock in the offering.
A representative for CK Hutchison Holdings Ltd, which is backed by Li’s family, didn’t immediately respond to an email seeking comment. A representative for Lifestyle International said Lau has no comment, while Meituan Dianping declined to comment in an emailed statement. Apple Daily reported the planned investments earlier Friday, citing unidentified people.
Meituan Dianping said Thursday it planned to keep on investing in money-losing businesses such as food delivery but did dial down its car-hailing ambitions, signaling a willingness to throttle back on a spending frenzy that’s pushed it deeper into the red.
In the local food arena, Meituan plans to invest on signing up more restaurants and helping them manage everything from crafting online menus to book-keeping. Choking off further spending on ride-sharing would at least avert a potentially costly battle with market leader Didi Chuxing.
In the four months ended April, revenue surged 95% to 15.8 billion yuan (US$2.3 billion), while losses almost tripled to 22.8 billion yuan. That includes the impact of acquiring unprofitable bike sharing startup Mobike.