Exits, Exits, IPO, Private Equity, Venture Capital

Li Ka-Shing Supported Hardware Developer Razer Inc Plans Hong Kong IPO

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Razer manufactures gaming peripherals such as mouse, keyboards specifically designed for playing video games.

Razer Inc., a U.S.-based computer hardware developer for the gaming industry backed by Hong Kong tycoon Li Ka-Shing, is planning to pursue an initial public offering on the Hong Kong Stock Exchange.

No financial details were disclosed in an IPO prospectus filed last week, but the company is reportedly seeking to raise between US$400 million to US$600 million in total. Once completed, it will become the first "e-sports concept stock" traded in Hong Kong.

Founded in 2005 by Singaporean entrepreneurs Min-Liang Tan and Robert Krakoff, Razer’s main business is manufacturing gaming peripherals such as mouse, keyboards, and mouse pads, as well as laptops specifically designed for playing video games and e-sports events, where audience watch professional video game players compete on big screens. Around 50% of its sales came from the U.S. market, while around 13% originated from China.

The company is still growing rapidly but is suffering expanding losses. Last year, it recorded revenues of US$329.1 million and a loss of US$59.6 million, up 22% and 193%, respectively, year-on-year, according to its IPO prospectus.

Two months ago, the company raised a US$43 million series D round from Li Ka-Shing’s venture capital firm Redmount Ventures at close to US$2 billion in valuation.

The company previously raised an undisclosed series C round at a valuation of US$1.5 billion last February. Hangzhou Liaison Interactive Information Technology Co., Ltd. injecting US$75 million in the company back then. Its investors also include IDG Capital, Hon Hai Precision Industry Co., Ltd. and Intel Capital.

Other investors include Intel Corporation, IDG Ventures and Temasek Holdings Ltd.

Razer plans to use the IPO proceeds to develop new verticals in the gaming and entertainment industry such as smartphones, as well as to expand its research and development capabilities, and finance acquisitions to expand its ecosystem.


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