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SoftBank-backed Dingdong targets over $6 billion valuation in U.S. IPO - Metro US

SoftBank-backed Dingdong targets over $6 billion valuation in U.S. IPO

A delivery worker of Chinese online grocery Dingdong Maicai works at a shop on a street in Shanghai

(Reuters) -Chinese unicorn Dingdong, backed by SoftBank Vision Fund II, is aiming for a more than $6 billion valuation in its New York debut as the grocery app joins Asian tech startups seeking to tap into the IPO boom in the United States.

The valuation represents a jump of over 20% from the $5.1 billion the company was worth after the Japanese conglomerate invested in it last month.

Dingdong said it aims to raise up to $357 million in its IPO as it seeks to navigate a crowded sector that has seen established players including Alibaba Group and Pinduoduo compete aggressively.

The company, which is also backed by Tiger Global Management and Sequoia Capital, will sell 14 million American Depositary Shares (ADSs) priced between $23.50 and $25.50 each, according to its filing.

Established in 2017, Dingdong operates mainly in China’s first-tier cities such as Shanghai, Beijing, Shenzhen and Hangzhou.

The COVID-19 pandemic has fueled online demand for fresh produce in China. Tencent Holdings Ltd-backed Missfresh, another Chinese online grocery startup, also set its IPO terms earlier on Tuesday, targeting a valuation of nearly $3.8 billion.

Dingdong and Tencent Holdings Ltd-backed rival Missfresh’s IPOs are among a spate of upcoming Chinese listings on U.S. stock exchanges this year.

Didi Chuxing, China’s biggest ride-hailing firm, has also filed for a long-anticipated U.S. stock market listing, setting the stage for what is expected to be the world’s biggest IPO this year.

Last year, Chinese companies raised $12 billion from U.S. listings, more than triple the funds raised in 2019, according to Refinitiv data. This year is expected to comfortably surpass last year’s tally.

Dingdong plans to list its shares on the New York Stock Exchange under the symbol “DDL”. Morgan Stanley, BofA Securities and Credit Suisse are the IPO’s lead underwriters.

(Reporting by Niket Nishant in Bengaluru;Editing by Vinay Dwivedi)

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