Ping An’s fintech arm One Connect Financial Technology said on Monday that it is aiming to raise $468 million in its US listing, a significant markdown from the previously reported $1 billion target.
Why it matters: One Connect is eyeing a valuation well below last year’s $7.5 billion in what may potentially be a “down round,” or a decrease in valuation following a new investment, considered rare among technology firms, according to media reports.
Details: The Shenzhen-based One Connect plans to offer 36 million American depositary shares (ADS) at a price range of $12 to $14 for a total of $4.9 billion at the midpoint of the range, according to Renaissance Capital.
- The firm plans to list on the New York Stock Exchange under the ticker symbol “OCFT.”
- Goldman Sachs, JP Morgan, and Morgan Stanley are among the eight main banks underwriting the deal.
- The long-awaited initial public offering (IPO) is expected to be priced on Dec. 12. The company’s IPO has been in the works since the start of the year.
- One Connect did not immediately respond to TechNode’s request for comment.
Context: One Connect focuses on providing financial technology solutions to small- and mid-sized financial institutions. It is an instrumental part of Ping An’s ongoing efforts to transform into a technology-driven company. The company in recent years has become one of the largest commercial blockchain platform operators.
- According to the company’s amended filing to the US Securities and Exchange Commission (SEC), One Connect’s losses for 2019 widened to more than RMB 1 billion for the first nine months of this year from RMB 579 million in 2018.
- One Connect had previously planned to raise $1 billion in Hong Kong at a valuation of about $8 billion. It changed the listing destination to New York from Hong Kong in June, hoping to achieve a higher valuation. New York, considered home to more mature markets, was a more attractive choice amid the trade tensions between China and the US and the months-long protests in Hong Kong.