General Atlantic To Invest $150M In Downsized Jumei IPO

Global growth equity investment firm General Atlantic‘s Singapore fund has agreed to invest US$150 million in Chinese beauty products e-commerce firm Jumei International Holding Ltd.’s downsized U.S. IPO, according to the latest securities filing of Jumei.

General Atlantic Singapore Fund Pte. Ltd. is to purchase US$150 million in ordinary A shares of Jumei at its final per unit IPO price in a private placement deal. General Atlantic’s investment total equals to almost three quarters of Jumei’s planned IPO.

In its amended F-1 filing submitted on May 6th, Jumei says it will issues 9.5 million American Depository Shares (ADS) at a price range of US$19.50 to US$21.50, raising a maximum of US$204 million in total.

In April, Jumei planned to raise up to US$400 million, which is already significantly less than the US$600 million it planned to raise reported by the media previously.

This follows a number of other Chinese companies who have slashed their IPO sizes, or even canceled IPO plans, due to overall market volatility and weak demand.

Earlier in April, Hong Kong-based pork company WH Group said that it had cancelled its planned US$5.3 billion Hong Kong IPO.

On April 30, Chinese travel and tour service provider Tuniu cut its IPO size by 15.7% to US$101.2 million, and also brought in Ctrip.com International Ltd. and Chinese security software maker Qihoo 360 Technology Co. as anchor investors.

A day earlier, Beijing-based Chinese security software maker Cheetah Mobile Inc. says that it will cut its planned U.S. IPO by over one third to US$174 million from US$300 million. It brought in three Chinese Internet companies to invest US$50 million in total as anchor investors.

General Atlantic is taking an unprecedented large stake of  Jumei’s IPO. Jumei previously received tens of millions U.S. dollars series A funding from Sequoia Capital and K2 Ventures in 2011.

According to the filing, Sequoia Capital and K2 Ventures own 18.7% and 10.3% of Jumei.com respectively. Xu Xiaoping, founder of Chinese seed fund Zhan Fund, owns 8.8% of the company as well.

It’s not clear if these shareholders are selling during the IPO.

Founded in 2010, Jumei.com sells luxury cosmetics brands such as Dior and Lancome, often through flash sales, via the web and its mobile apps.

Jumei.com says it is the No. 1 online retailer of beauty products in China with 10.5 million active customers.

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