Chinese package delivery company ZTO Express Inc (中通快遞) on Wednesday said it raised US$1.4 billion in the biggest US initial public offering (IPO) of the year as its backers cashed in on China’s booming online-shopping industry.
The stock market debut, the biggest by a Chinese company since the US$25 billion IPO of e-commerce giant Alibaba Group Holding Ltd (阿里巴巴)in 2014, gave the Shanghai-based company a market value of more than US$12 billion.
ZTO’s US listing is a head start over rivals in the world’s largest express delivery market because it gives the company faster access to cash to expand.
Photo: Reuters
The company wants to use US$720 million of its IPO proceeds to buy more trucks, land, facilities and equipment.
Its Chinese competitors SF Express (順豐速運), YTO Express (圓通速遞), STO Express (申通快遞) and Yunda Express (韻達快遞) have all unveiled plans for listings in Shenzhen and Shanghai, but with a backlog of about 800 companies waiting for approval to go public in China and frequent changes to the rules, a New York listing is regarded as a quicker and more reliable way of raising funds and tapping a broader mix of investors.
ZTO’s existing shareholders, including private equity firms Warburg Pincus LLC, Hillhouse Capital Management (高瓴資本管理) and venture capital firm Sequoia Capital (紅杉資本), will also get much more leeway and flexibility to exit their investment under US market rules.
In China, they would be locked in for one to three years after the IPO.
ZTO priced 72.1 million shares at US$19.50 a share, above its previously indicated range of US$16.50 to US$18.50 a share.
That price is about 27 times its expected earnings per share for next year, according to people familiar with the company’s financials.
US rivals, United Parcel Service Inc and FedEx Corp, which are growing at a much slower pace, are trading at multiples of 17.8 and 13.4 times expected next year’s earnings.
As concerns grow about a weakening Chinese currency, the New York IPO also gives the company more stable US dollar-denominated shares it can use for international acquisitions, according to people close to the company.
China’s express delivery firms handled 20.7 billion parcels last year, shifting 1.5 times the volume moved in the US, according to consulting firm iResearch data cited in the ZTO prospectus.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six