Four months after Chinese online movie-ticketing platform Maoyan Entertainment filed a prospectus with the Hong Kong Stock Exchange under the name Entertainment Plus, the company is said to be looking to raise anywhere from US$300 million to US$400 million in its upcoming initial public offering. Chinese tech media outlet All Weather TMT reported that the IPO may take place as early as this month. Maoyan’s pre-market roadshow will begin tomorrow.
Maoyan Entertainment has provided a breakdown of how it will use its IPO proceeds: 10% will be folded into working capital, while investments and acquisitions, research and development, and platform reinforcement will each use 30% of the funds.
Maoyan was developed as an app in 2012 as part of Hong Kong-listed Meituan’s entertainment department, but became a separate legal entity and Meituan-Dianping’s exclusive ticketing channel three years later. In September 2017, Maoyan merged with Tencent-backed Weiying to become China’s biggest movie ticketing operator. Maoyan Entertainment is yet another proxy for the battle between Tencent and Alibaba, which backs the ticketing portal Tao Piao Piao.
In Maoyan Entertainment’s prospectus, the company cites iResearch data to indicate that it held more than 60.9% movie ticketing market share in China in the first half of 2018. The company also claims to have more than 130 million monthly active users.
Maoyan has seen rapid growth over recent years. Specifically, its annual net income more than doubled from RMB 298 million (US$43.5 million) to RMB 1.74 billion (US$254 million) in 2017. By 2017, the firm also managed to turn its previous net adjusted loss of RMB 12.7 billion (US$1.9 billion) into RMB 216 million (US$31.5 million) in profits.
The prospectus lists Maoyan Entertainment’s major shareholders as Maoyan Entertainment Group, which holds a 48.8% stake; Tencent, which controls 16.72% of the company; and Meituan, which owns 8.56% of shares. The company’s IPO will be underwritten by Merrill Lynch and Morgan Stanley.
Editor: Brady Ng
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