Tencent-backed DouYu Tumbles After Raising $775m In US IPO

Chinese video-game live-streaming platform DouYu International Holdings Ltd. fell in its trading debut after its $775 million U.S. initial public offering.

The company, which delayed its IPO amid market jitters in May, sold 44.9 million American depository shares for $11.50 each on Tuesday, with its investors selling 22.5 million additional shares. The shares, which which were priced at the bottom end of the marketed range, opened down 4.2% at $11.02.

DouYu, backed by Tencent Holdings Ltd., fell 0.9% to $11.40 at 12:03 p.m. in New York trading, valuing the company at $3.68 billion.

The offering was the biggest cross-border listing from China since Tencent Music Entertainment Group raised $1.07 billion in its U.S. IPO in December.

DouYu, one of China’s top two video-game live-streaming platforms, initially planned to start its IPO roadshow in May but postponed it following President Donald Trump’s threat to boost tariffs on China, people familiar with the matter said at the time. The Wuhan-based company had filed for its IPO on April 22, almost a year after its biggest competitor, Huya Inc., went public in the U.S.

DouYu had net income of $2.7 million on revenue of $222 million in the first quarter, according to its filings with the U.S. Securities and Exchange Commission. That compared with a loss of about $23 million on revenue of $97 million during the same period last year.

Existing investors that sold shares in the IPO included Aodong Investments and Co-Chief Executive Officer and co-founder Zhang Wenming, according to the company’s filings.

Morgan Stanley, JPMorgan Chase & Co., Bank of America Corp. and CMB International Capital Ltd. led the offering. The shares are trading on the Nasdaq Global Select Market under the symbol DOYU.

Bloomberg