Online Retailer China Dangdang Raises $272 Million
E-Commerce China Dangdang Inc., the nation’s largest online book retailer, raised $272 million in its U.S. initial public offering, 23 percent more than it originally sought.
China Dangdang sold 17 million American depositary receipts at $16 each after offering them for $13 to $15 apiece, according to a filing with the Securities and Exchange Commission and data compiled by Bloomberg. The Beijing-based company increased the price range from $11 to $13 yesterday. It starts trading on the New York Stock Exchange tomorrow under the ticker DANG.
The online retailer was the first of five Chinese IPOs scheduled in the U.S. this week. Beijing-based Youku.com Inc., China’s biggest online video company, is also set to offer shares today. The sales this week would bring the number of Chinese IPOs in New York to 39 this year, surpassing the 37 in 2007, data compiled by Bloomberg show. China, home to more than 400 million Internet users, may expand four times as fast as the U.S. next year, according to the International Monetary Fund.
Credit Suisse Group AG in Zurich and Morgan Stanley of New York led the offering for China Dangdang.
The four Chinese Internet companies that completed U.S. IPOs this year surged an average of 57 percent in their first day of trading, data compiled by Bloomberg show. ChinaCache International Holdings Ltd., a Beijing-based provider of content for business websites, posted the biggest first-day rally on U.S. exchanges in three years, jumping 95 percent on Oct. 1.
The original midpoint IPO price of $12 valued China Dangdang at 48 times annual earnings, based on third-quarter results, data compiled by Marina del Rey, California-based IPOdesktop.com show. That’s 64 percent higher than the median of 29.2 estimated profit for 11 U.S.-traded Internet retailers, data compiled by Bloomberg show. Seattle-based Amazon.com Inc., the biggest online merchant, trades at 39 times profit.
China Dangdang, which operates the dangdang.com website, increased sales by 56 percent in the first nine months of 2010 from the same period a year ago, its prospectus said. The company plans to use proceeds to broaden its product categories and expand its order fulfillment capabilities.
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