Alibaba, Matrix-Backed Momo To Raise $256M In US IPO

Beijing-based Chinese mobile social instant message app developer Momo Inc., backed by a long list of venture capital and private equity firms, has priced its NASDAQ IPO, hoping to raise as much as US$256 million, according to an updated regulatory filing.

Momo says it is to issue 16 million American Depositary Shares (ADS) at the price range of US$12.50 to US$14.50 per ADS. Its shares will be listed under the symbol "MOMO".

Concurrent with the IPO, the company plans to issue US$50 million and US$10 million worth of shares to existing shareholders, Alibaba Group Holdings Ltd. and Chinese Craigslist-like platform Inc., in a private placement deal.

According to the latest filing, Alibaba Investment Limited and a fund managed by Matrix Partners holds 68.86 million and 65.97 million shares of Momo, or 20.7% and 19.9% of the company, respectively, before the IPO.

Matrix Partner’s shares are held by Matrix Partners China II Hong Kong Limited.

Funds managed by Sequoia Capital holds 18.57 million shares, or a 5.6% stake.

Established in 2011, Momo raised series B financing in 2012, receiving US$6.5 million from Matrix Partners, US$20.7 million from Alibaba Group Holdings, through Alibaba Investment Limited, as well as US$1.5 million from DST Global, an investment firm founded by Russian businessman Yuri Milner.

In 2013, the company completed series C financing, in which Matrix invested US$13 million, Alibaba and DST Global each put in another US$10 million.

In its latest financing round in April 2014, Sequoia Capital invested US$90 million, Yunfeng Capital, co-founded by Alibaba’s founder Jack Ma, injected US$90 million and U.S. investment firm Tiger Global Management LLC invested US$31.8 million, according to the filing.

Momo says it is among the top three mobile social instant message apps in China, with 180 million registered users and 60 million monthly active users.

The company recorded total net revenues of US$1.46 million and net loss of US$22.88 million during the first three quarters in 2014, compared with total net revenues of US$3.13 million and net loss of US$9.33 million in 2013.

Caishen.Co - Primary Data for China Secondary Investment and Stock Markets
Caishen.Co - Primary Data for China Secondary Investment and Stock Markets