Ruhnn Holding, an Alibaba-backed Chinese e-commerce platform for social media influencers, has raised about $125 million in a US initial public offering after pricing 10 million American depositary shares (ADSs) at $12.50 million each.
Its total IPO proceeds could increase if the underwriters exercise their over-allotment option to purchase additional 1.5 million ADSs, the company said in a statement.
The ADSs, each representing five Class A ordinary shares of the company, are expected to begin trading on the Nasdaq Global Select Market under the ticker symbol “RUHN”.
The target amount is less than the $200-million figure that Ruhnn specified when it filed its prospectus in March. Citigroup Global Markets and UBS Securities were the joint bookrunners for the deal.
Ruhnn earlier said the funds from the IPO will be used for the pursuit of additional monetization channels and strategic investments, identifying and training key opinion leaders (KOL), technology, and general corporate purposes, according to the prospectus.
In the papers it filed with the US SEC, Ruhnn claims to be the largest internet KOL facilitator in China based on 2018 revenue. As of December last year, the company had 113 signed KOLs with an aggregate of 148.4 million fans across major social media platforms in China.
KOLs, also known as influencers, are individuals who have the “power to engage and impact people” within a specific community or field, such as fashion, culture, entertainment, and gaming.
Ruhnn has some ties with China’s biggest e-commerce company, Alibaba Group Holding Ltd. Alibaba’s retail platform, Taobao China Holding Ltd, holds a stake of 8.56 per cent in Ruhnn, while one of its directors, Pen Hung Tung, serves as Alibaba’s chief marketing officer.
The company has two revenue streams – product sales from sales of various fashion and lifestyle products to consumers through its KOL online stores under the full-service model; and service revenues from the provision of various KOL sales and advertising services to brands, online retailers and other merchants under a platform model.
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