Zero2IPO, CDH Venture-Backed Wowo Plans $40M US IPO


Beijing-based Wowo Limited, which operates Chinese group-buying site 55tuan.com, has filed with the U.S. Securities and Exchange Commission to raise up to US$40 million in a NASDAQ IPO, according to a securities filing.

No pricing information or timing of the IPO have been determined.

The company announced its IPO plans three years ago, but it went nowhere as China’s group-buying sector was pressured by fierce competition.

Investors are cautious of the prospects of its current IPO plan because of the company’s poor financials and weak competitive position.

Wowo recorded net revenues of US$20.6 million and net loss of US$32.4 million during the first nine months of 2014, compared with net revenues of US$27.6 million and net loss of US$21.1 million during the same period in 2013, according to the filing.

The company’s transaction value was RMB442 million during the first eight month of 2014, compared to Meituan’s RMB4.36 billion and Dianping’s RMB1.83 billion, according to an industry report.

Founded in 2010, Wowo received US$5 million of financing from Zero2IPO China Fund II L.P. by issuing series A-1 shares, and US$50 million from Zero2IPO China Fund II, CDH Venture, Besto Holdings Limited, and other unnamed investors by issuing series A-2 shares in 2011.

In 2012, the company received US$12.5 million from CDH Venture, Besto Holdings Limited, New Field Worldwide Limited, and other unnamed investors by issuing series B shares.

It also issued 6.7 million shares A-1 shares and 70.7 million series A-2 shares to existing A-1 and A-2 investors for free, says the filing.

Wowo says it has 34 million subscribers with 430,000 services offerings in 150 cities across China as of September 2014.

 

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