There are three IPOs and two SPACs expected to price this week, the most notable of which is Tencent Music, China's largest online music-streaming service. Tencent's long-anticipated IPO is the latest in a long string of Chinese IPOs we have seen this year, the bulk of which have experienced poor returns (including Tencent-backed fashion portal MOGU). Tencent Music is joined by online consumer lending platform 360 Finance, another Chinese deal. Texas-based manufactured home company Legacy Housing is also expected to price.
Street research is expected on Monday for Chinese auto-backed loan provider Weidai (WEI), micro-cap liquid drug developer Eton Pharmaceuticals (ETON), and noninvasive breathing device provider Vapotherm, (VAPO).
| U.S. IPO Calendar | |||
|---|---|---|---|
| Issuer Business |
Deal Size Market Cap |
Price Range Shares Filed |
Top Bookrunners |
| Tencent Music (TME) Shenzhen, China |
$1,148M $23,512M |
$13 - $15 82,000,000 |
Morgan Stanley Goldman (Asia) |
| Leading Chinese provider of music streaming, live streaming and online karaoke. | |||
| CF Finance Acquisition (CFFAU) New York, NY |
$250M $319M |
$10 25,000,000 |
Cantor Fitz. |
| Blank check company formed by the CEO of Cantor Fitzgerald. | |||
| 360 Finance (QFIN) Shanghai, China |
$54M $2,738M |
$16.50 - $18.50 3,100,000 |
Citi Haitong |
| Chinese online consumer lending platform partnered with 360 Group (Qihoo). | |||
| Chardan Healthcare Acq. (CHACU) New York, NY |
$70M $88M |
$10 7,000,000 |
Chardan |
| Blank check company formed by Chardan to acquire a healthcare business. | |||
| Legacy Housing (LEGH) Bedford, TX |
$41M $276M |
$10.75 - $12.75 3,500,000 |
B. Riley FBR |
| Builds, sells, and finances manufactured homes. | |||
| Schultze Acquisition (SAMAU) Rye Brook, NY |
$150M $188M |
$10 15,000,000 |
EarlyBird BTIG |
| Blank check company formed by distressed debt investor George Schultze. | |||
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Tencent Music Entertainment Group (TME), China's largest online music-streaming service, plans to raise $1.1 billion by offering 82 million ADSs at a price range of $13 to $15. At the midpoint of the proposed range, Tencent Music would command a market value of $24 billion. Tencent Music, which was founded in 2003, booked $2.5 billion in sales over the last 12 months. The Shenzhen, China-based company plans to list on the NYSE under the symbol TME. Morgan Stanley, Goldman Sachs (Asia), J.P. Morgan, and Deutsche Bank are the joint bookrunners on the deal.
Legacy Housing (LEGH), which builds, sells, and finances manufactured homes, plans to raise $41 million by offering 3.5 million shares at a price range of $10.75 to $12.75. At the midpoint of the proposed range, Legacy Housing would command a market value of $276 million. Legacy Housing, which was founded in 2005, booked $169 million in sales over the last 12 months. The Bedford, TX-based company plans to list on the Nasdaq under the symbol LEGH. B. Riley FBR, and Oak Ridge Financial are the joint bookrunners on the deal.
360 Finance (QFIN), a Chinese online consumer lending platform partnered with 360 Group (Qihoo), plans to raise $54 million by offering 3.1 million ADSs at a price range of $16.50 to $18.50. Chairman Hongyi Zhou and two investors intend to purchase up to $40 million of the IPO (74% of the deal). 360 Finance, which was founded in 2016, booked $235 million in sales over the last 12 months. The Shanghai, China-based company plans to list on the NYSE under the symbol QFIN. Citi, Haitong, and AMTD Asset Management are the joint bookrunners on the deal.
CF Finance Acquisition (CFFAU), a blank check company formed by the CEO of Cantor Fitzgerald, plans to raise $250 million by offering 25 million units at a price of $10. Each unit will consist of one share of common stock and one warrant to purchase one share of common stock at $11.50. At $10, CF Finance Acquisition would command a market value of $319 million. CF Finance Acquisition was founded in 2014. The New York, NY-based company plans to list on the Nasdaq under the symbol CFFAU. Cantor Fitzgerald is the sole bookrunner on the deal.
Chardan Healthcare Acquisition (CHACU), a blank check company formed by Chardan to acquire a healthcare business, plans to raise $70 million by offering 7 million units at a price of $10. Each unit will consist of one share of common stock and one warrant to purchase one half of one share of common stock at $11.50. At $10, Chardan Healthcare Acquisition would command a market value of $88 million. Chardan Healthcare Acquisition was founded in 2017. The New York, NY-based company plans to list on the NYSE American under the symbol CHACU. Chardan is the sole bookrunner on the deal.
IPO Market Snapshot
The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 12/6/18, the Renaissance IPO Index was down 8% year-to-date, while the S&P 500 had a gain of 3%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include VICI Properties (VICI) and Spotify (SPOT). The Renaissance International IPO Index was down 19% year-to-date, while the ACWX was down 12%. Renaissance Capital’s International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include innogy and Siemens Healthineers.
Renaissance Capital will have Pre-IPO Research available on each of these upcoming IPOs prior to its pricing.
