eCargo, a China-based e-commerce solutions provider for retailers and fashion brands, has announced an initial public offering on the ASX.
The offer will value eCargo at $A224 million and position the e-commerce provider for growth in its primary markets of China and Hong Kong, as well as future expansion in Australia, the United Kingdom, and Europe.
The eCargo business acts as a “one-stop” enabler for branded manufacturers and retailers seeking to sell their products online in China and gain exposure to China’s online consumers by providing integrated online and offline supply chain solutions.
The IPO underpins a new phase of growth for eCargo as it seeks to expand operations initially in China and Hong Kong, as well as capitalise on acquisition opportunities with complementary businesses in China, Hong Kong, and international markets, with longer term plans to increase its presence in Australia.
eCargo anticipates significant merchant growth will come through existing relationships with leading retail and fashion brands trading in the Chinese market. eCargo is already engaged by a number of major fashion merchants to enable the growth of their online businesses in China and Asia.
The IPO is seeking to raise $A40 million through the offer of 100 million CHESS Depository Interests (“CDIs”) at $A0.40 per CDI, equivalent to 100 million shares at $A0.40 per share.
“The IPO is a unique opportunity for investors to get in at the ground floor of a company which has an experienced management team who are able to offer merchants a turnkey e-commerce solution, and offers direct and rare exposure to the world’s largest online shopping and mobile consumer population, China,” John Lau, founder and chairman of eCargo, said.
“China is one of the largest and fastest growing e-commerce markets in the world and since 2003 has experienced 120 per cent compound annual growth, with fashion and apparel being the highest turnover product categories merchant customer segments.
“eCargo is strategically poised to capitalise on the growth of China’s e-tailing market and the emerging structural shift underway in the behaviour of Chines.”
The Asia-Pacific region is already the world’s second largest e-tailing market with estimated revenues of $US563.28 billion in 2014.
In China, consumer spending is tipped to grow from $US2.03 trillion in 2010 to $US6.18 trillion annually in 2016, representing a threefold increase spectrum of services to merchants who wish to enter the Chinese online consumer market.
