Mogu, a Tencent-backed service that offers fashion content and products to young women, has joined a string of Chinese tech companies pressing ahead to sell their shares through initial public offerings in the US before the year-end.
Mogu priced its sale at $14 per share on Wednesday, toward the lower end of a marketed range. That values the unprofitable company at $1.3 billion, a drop from the estimated valuation of $3 billion after Mogujie acquired its chief competitor Meili to form Mogu in 2016.
The firm is poised to raise $66.5 million from the IPO, which will help it fund content and technological development to vie for a piece of China’s $390 billion online fashion market.
While Alibaba has long dominated how people buy clothes online, a few smaller players including Pinduoduo and Mogu have managed to carve out a niche.
According to a September report by mobile analytics firm QuestMobile, Mogu controlled an 8.1 percent penetration rate among ecommerce apps targeting women under 24 years old. Alibaba led the game at 98 percent.
Now a formidable rival, Alibaba has played a key role in Mogu’s early day growth.
Under the giant’s shadow
In 2009, Chen Qi, a former …read more