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IPO

Hong Kong's Lalamove files for $1bn American IPO

Sources also say China's Xpeng targets up to $2bn in homecoming listing

A Lalamove truck with company founder Shing Chow.

HONG KONG -- Hong Kong-based logistics startup Lalamove has filed confidentially for a U.S. initial public offering that could raise about $1 billion, two people familiar with the plan say, joining a string of companies from greater China seeking cash in the world's largest capital market.

Mainland companies are shrugging off mounting tensions between Washington and Beijing as they aim to tap the heavy liquidity and investor demand for high-growth businesses in the U.S. market.

Separately, U.S.-listed Chinese electric vehicle maker Xpeng seeks a primary dual listing in Hong Kong, a filing with the city's stock exchange shows. The company could procure up to $2 billion in the share sale, a source said. The liquidity and demand in fellow large market Hong Kong also are attracting attention from mainland businesses.

Xpeng shares opened at $42.45 in New York on Wednesday, up 6.2% from the previous day's close.

While awaiting regulatory approval, Lalamove will hold preliminary investor meetings to gauge demand for the company, which operates in more than 20 markets across Asia and Latin America as well as in the U.S., connecting over 7 million users with 700,000 drivers, the sources said.

Lalamove, established in 2013, helps clients outsource their freight logistics needs. It has raised $2.5 billion from 18 investors including private equity firm Hillhouse Capital and Sequoia Capital China, according to Crunchbase.

The startup's latest round was completed in January when it raised $1.5 billion at a pre-money valuation of $8.5 billion, Crunchbase data shows. The company is targeting an IPO valuation of at least $10 billion and considering selling a 10% stake, the two sources said.

In tapping the American market for an IPO, Lalamove will join the likes of cargo platform Full Truck Alliance, which raised $1.6 billion, and Kanzhun, operator of online recruitment platform Boss Zhipin.

Chinese ride-hailing service Didi Chuxing is holding preliminary investor meetings for what is shaping up to be a $10 billion New York IPO, people familiar with its plans say. Another 20 companies, including online grocers Dingdong Maicai and MissFresh and hotel operator Atour, are preparing for offerings that together could raise around $6 billion.

The flurry of listings likely will push the 2021 total for Chinese companies in New York well above last year's $13.5 billion haul, which according to Dealogic data was the highest total since 2014's record $29.1 billion. That bonanza stemmed from Alibaba Group Holding's $25 billion New York Stock Exchange IPO.

Even as companies rush to Wall Street, so-called homecoming listings -- where mainland businesses trading in the U.S. seek to sell shares in Hong Kong -- also have revived after a two-month lull.

Xpeng is the latest to take this route. The automaker received approval from the Hong Kong exchange's listing committee to sell shares in the city and now can hold investor meets.

Xpeng, which raised $1.72 billion from an IPO on the New York Stock Exchange in August, will have to undertake a dual primary listing in Hong Kong as it lacks a two-year listing track record to qualify for a secondary listing like others such as Alibaba and JD.com.

As such, the company needs to comply with the rules of both U.S. and Hong Kong regulators, which is not the case with a secondary listing. A successful offering will make it the first homecoming listing since Trip.com's share sale in April. Such offerings have gotten a boost from companies looking to hedge against a forced delisting in the U.S.

Under a law enacted last year, Chinese companies risk being kicked off American exchanges by 2023 if U.S. regulators are not permitted to review their audit records. Beijing forbids such reviews on national security grounds. The U.S. Securities and Exchange Commission last month began steps toward putting the law into force.

Xpeng, which is yet to make a profit, in December sold more shares to raise $2.5 billion. The company's shares have surged 180% since the IPO, and it is valued by the market at $32 billion.

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