The China-based company, a cloud-based commerce and marketing solution provider, hit the market on Thursday evening in Hong Kong to sell 255m primary shares, which represent 11.25% of its equity capital, in a top-up.
Joint bookrunners CICC, Credit Suisse and Haitong International launched an accelerated bookbuild at HK$4.60 to HK$4.80 each, according to a term sheet seen by GlobalCapital Asia.
The range enticed investors with a 7.69% to 11.54% discount to the stock’s last close at HK$5.20 per share and a 7.79% to 11.64% discount to the average closing price of HK$5.206 for the five days leading up to the sale.
After a short subscription period, the company settled on pricing the shares at HK$4.60 apiece, with an 11.54% discount.
The vendors that facilitated the top-up were Yomi.sun Holding and Weimob Teamwork, both indirectly controlled by Weimob’s chairman and chief executive officer Sun Taoyong, as well as Alter.You Holding, which is controlled by You Fengchun, one of the company’s executive directors.
The three entities held a combined 462.7m shares, or 23%, of Weimob’s stock before the top-up and own 20.41% following the deal.
Weimob plans to use the proceeds from the deal for strategic co-operation, potential investments and acquisitions, and support post-acquisition operations in order to expand and improve its product offering.
The firm targets small and medium enterprises in China. When it listed in Hong Kong in January this year, it was the largest third-party solution provider for SMEs via WeChat in terms of revenue and number of paying merchants in 2017, according to research in its IPO prospectus.
Founded in 2013, Weimob raised HK$845m from its IPO. Its stock price has soared 86% since floating at HK$2.8 per share, surging from HK$4.00 in early April after it published strong 2018 financial results. This included a 62% year-on-year revenue growth to Rmb865m, as well as news that internet company Tencent had increased its stake in the firm.
Meanwhile, shareholders Shanghai Zhengmu Investment Center, Shunfeng.li Holding and V-Capital International Holding Co sold 50m secondary shares in Weimob in a concurrent trade to cover for the overflow of demand from the top-up, GlobalCapital Asia understands.
The block, which represents 2.21% of Weimob’s enlarged share capital, was also priced at the bottom of guidance, netting the trio HK$230m.
The sale has reduced the investors’ combined 7.9% shareholding in Weimob to 4.81%. They have agreed to a 90-day lock up on their remaining stakes in the company.