WM Tech’s $1 Billion Hong Kong IPO Stalls on Vetting
(Bloomberg) -- WM Tech Corp.’s planned initial public offering in Hong Kong is facing delays as the city’s bourse questions the supermarket owner on its business operations, people with knowledge of the matter said.
The Beijing-based company behind the Wumart chain and Metro AG’s outlets in China is addressing queries Hong Kong Exchanges and Clearing Ltd. raised during the IPO vetting process, said the people, asking not to be identified as the information isn’t public.
WM Tech filed in March for a Hong Kong IPO, with Citic Securities Co., China Merchants Bank Co. and Goldman Sachs Group Inc. acting as joint sponsors. The company could raise as much as $1 billion, people familiar with the matter have said.
Separately, the planned U.S. IPO of Beijing DMall E-commerce Co. has also come to a standstill, according to people familiar with the matter. The online retail service provider is controlled by Zhang Wenzhong, the chairman and founder of WM Tech.
Dmall provides retail software and e-commerce digital services to WM Tech, according to the latter’s exchange filing. WM Tech is a significant contributor to Dmall’s revenue, it said.
Beijing-based Dmall is working with advisers and sought to list in the U.S. as soon as the second half of this year, Bloomberg News reported in February.
Deliberations are ongoing and the companies could still proceed with their respective IPOs, the people said. Representatives for HKEX, WM Tech and Dmall declined to comment.
Founded by Zhang in 1994, WM Tech has developed into one of the country’s biggest retailers with more than 426 Wumart stores and 97 Metro stores across China, according to the filing. Germany’s Metro agreed in 2019 to sell a majority stake in its Chinese business to Wumei Holdings Inc. for about 1.5 billion euros ($1.8 billion), completing the deal the following year.
WM Tech had annual revenue of 39.1 billion yuan ($6 billion) in 2020, while its net income for the same period was 717 million yuan, the filing shows.
Dmall has about 19 million monthly active users, and counts Tencent Holdings Ltd. and IDG Capital among its backers, its website shows.
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