Chinese unicorn T3 Mobility plans Hong Kong IPO after Series B - sources

Breaking News 23 February

Chinese unicorn T3 Mobility plans Hong Kong IPO after Series B - sources

T3 Mobility, a Chinese ride-hailing unicorn, is in talks with a handful of institutional investors on a proposed CNY 3bn-CNY 5bn (USD 436.6m-USD 727.7m) Series B fundraising, two sources familiar with the situation said. 

This will be the final private round for T3, the country’s No. 2 ride hailing services provider after Didi Global, ahead of an intended year-end listing in Hong Kong. It will be competing with a handful of rivals for Hong Kong investors’ money as it goes public. 

The four-year-old company is a joint venture (JV) among Alibaba [HKG:9988], Tencent [HKG:0700] and the three largest Chinese state-owned automakers - FAW Group, Dongfeng Motor Corporation and Chongqing Changan [SHE: 000625].

Also known as T3 Chuxing, the ride hailer started to soft-market the B round to a mix of private equity firms or strategic players in December 2022, the first source said. The latest round's valuation isn't available. 

The transaction is scheduled to be completed before the end of June 2023, both said.  

Proceeds will be used for client acquisitions to up its market share in China, the first source said. 

The company is China’s No.2 ride-hailing services provider in terms of daily active users, according to a teaser seen by this news service. 

In October 2021, it pocketed CNY 7.7bn in a Series A round, led by a consortium headed by CITIC Group, as 36Kr reported citing T3 Mobility, which didn't disclose the valuation. 

Mandate race 

Following the ongoing financing round, T3 Mobility plans to go public in Hong Kong by the year-end at the earliest, the sources said. 

The company has received pitches from a couple of investment banks, but the sponsor mandate(s) may go to banks who could help secure investments for Series B, the second source said. 

It aims to fetch a market capitalization of about HKD 40bn (USD 5.1bn) upon its potential share floatation, the second source said. 

T3 Mobility, serving 103 cities across China, had signed up more than 100m registered users as of 2022, in which 2.1m are daily active users, according to the teaser.

Its gross merchandise volume reached over CNY 20bn in 2022, as per the teaser, more than double that of 2021's CNY 8.3bn. 

The company had more than 700,000 vehicles available on the platform, the teaser reads. 

IPO season for ride hailing services 

T3 Mobility’s main domestic rivals, including Didi Global, Cao Cao Mobility and Ruqi Mobility are all queuing up for a Hong Kong initial public offering, the sources said. 

The country’s largest player Didi Global has been working with banks to explore a potential Hong Kong listing after it was delisted from the New York Stock Exchange last year, the second source said. It had secured the green light to sign up new users, suggesting the worst is possibly over for the firm, according to a Bloomberg report in January.

Cao Cao Mobility was reported by Bloomberg in December 2022 to have hired ABC International, Bank of America and Huatai Financial to help arrange its Hong Kong IPO this year. 

Ruqi Mobility is looking to file in the second quarter of 2023 for a USD 200m Hong Kong listing, as reported by this news service in January 2023.

T3 Mobility did not respond to request for comment. 

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