Caixin
Mar 17, 2021 04:50 AM
BUSINESS & TECH

Bilibili Wins Approval for Hong Kong Secondary Listing

Bilibili had 202 million average monthly active users in the fourth quarter, with 17.9 million paying users.
Bilibili had 202 million average monthly active users in the fourth quarter, with 17.9 million paying users.

Chinese video streaming platform Bilibili Inc. received a green light from the Hong Kong Stock Exchange for a proposed secondary listing.

The Nasdaq-traded technology firm hasn’t disclosed the offering size, but Bloomberg reported it could raise $3 billion from the share sale, citing people familiar with the matter.

Bilibili, which counts Tencent Holdings Ltd., Alibaba Group Holding Ltd. and Sony Corp. as investors, will be the latest in a string of major U.S.-listed Chinese companies to make secondary offerings in Hong Kong after the U.S. threatened to remove U.S.-traded Chinese companies that fail to meet certain auditing standards.

Returning to Hong Kong has emerged as a preferred option for U.S.-traded Chinese companies seeking to expand their funding sources and functions as a hedge against potential removal from American exchanges. In the past two years, U.S-listed Chinese tech giants including Alibaba Group Holding Ltd., JD.com Inc. and NetEase Inc. have all floated shares in Hong Kong.

Chinese search engine giant Baidu Inc. is seeking to raise as much as HK$28 billion ($3.6 billion) in a secondary offering in Hong Kong, kicking off the second such share sale by a U.S.-traded Chinese company in the city this year. Other companies considering selling stock in the city include Tencent Music Entertainment Group.

Bilibili raised $483 million in its initial public offering on the Nasdaq in March 2018. Its American depositary shares have risen more than ninefold from their original offering price of $11.50, giving the company a market value of $39 billion.

Founded in 2009, Bilibili is one of the largest video-sharing platforms in China and is popular with millennials for its animation and gaming content. The company had 202 million average monthly active users in the fourth quarter, with 17.9 million paying users.

In recent years, Bilibili has sought to reposition itself as a platform not only for animation fans but also for moviegoers, gamers and merchants as competition heats up in the sector.

Bilibili beat expectations with 91% revenue growth in the fourth quarter of 2020, boosted by strong gains for its mobile gaming, advertising and e-commerce businesses. But the company continued to lose money, with the fourth-quarter net loss more than doubling to 843.7 million yuan from 387.2 million yuan a year earlier.

For the full year of 2020, Bilibili reported total net revenue of 12 billion yuan, up 77% from 2019. Its annual net loss more than tripled to 3.1 billion yuan from 1.3 billion yuan in 2019.

Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and UBS Group AG are sponsors for the offering.

Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bobsimison@caixin.com).

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