Dangdang Files to IPO on NYSE
SEC, 11/17/10
E-Commerce China Dangdang Inc., which operates Chinese B2C e-commerce site Dangdang, has filed an IPO prospectus to list on the New York Stock Exchange under the ticker symbol "DADA," though it has not yet disclosed the number of shares or pricing. The IPO is being underwritten by Credit Suisse, Morgan Stanley, Oppenheimer, Piper Jaffray, and Cowen and Company.
Total net revenues were RMB 446.9 mln in 2007, RMB 766.1 mln in 2008, and RMB 1.46 bln (USD 217.9 mln) in 2009, representing a compound annual growth rate (CAGR) of 80.6%. For the nine months ended September 30, 2010, total net revenues amounted to RMB 1.5708 bln (USD 234.8 mln), representing a 55.6% increase from RMB 1.0096 bln for the nine months ended September 30, 2009.
Dangdang incurred a net loss of RMB 70.5 mln in 2007 and a net loss of RMB 81.8 mln in 2008, followed by a net profit of RMB 16.9 mln (USD 2.5 mln) in 2009 and a net profit of RMB 16.0 mln (USD 2.4 mln) for the nine months ended September 30, 2010.
As of September 30, 2010, Dangdang offered approximately 590,000 book titles, including more than 570,000 Chinese language titles. Books accounted for 91.5%, 91.1%, 89.0% and 84.2% of Dangdang's total net revenues in 2007, 2008 and 2009 and the nine months ended September 30, 2010, respectively.
Dangdang also offers other media products and selected general merchandise categories, including beauty and personal care products, home and lifestyle products, and baby, children and maternity products. In July 2009, Dangdang launched its marketplace program, which allows third-party merchants to sell their general merchandise products alongside Dangdang products.
Dangdang had 6 mln active customers in 2009. Average daily unique visitors increased from approximately 910,000 in 2009 to 1.24 mln in the nine months ended September 30, 2010. Average daily unique visitors further increased to 1.61 mln in September 2010. In the three months ended December 31, 2007, 2008 and 2009 and the three months ended September 30, 2010, approximately 66%, 71%, 77% and 78%, respectively, of product revenues were generated from repeat customers. During the nine months ended September 30, 2010, Dangdang acquired approximately 3.4 mln new customers.
Dangdang plans to use the funds raised in the IPO to broaden its product categories, expand its fulfillment capabilities and further enhance its technology infrastructure, and for general corporate purposes, including working capital and funding potential acquisitions of complementary businesses, although Dangdang is not currently negotiating any such transactions.
As of September 30, 2010, Dangdang had 1,142 full-time employees, including 790 in fulfillment, 22 in marketing, 202 in technology and content and 128 in general and administrative.
CEO and director Li Guoqing and Chairwoman Peggy Yu Yu, husband and wife founders of the company, together own an aggregate of 43.7% of Dangdang's outstanding shares. Tiger Global Private Investment Partners holds 75 mln B-shares, DCM IV holds 27.37 mln B-shares, and IDG Technology Venture Investment holds 21.43 mln.
Editor's Note: For more information on the IPO, please see "Dangdang to Raise USD 200 Mln by Year-End," MD 9/26/10 issue. For more on Dangdang's previous rounds of fundings, please see "Dangdang Plans 4th Round of Funding," 7/27/2007 issue. To read Dangdang's complete IPO filing, please click here.
Keywords: statistics Internet traffic Li Guoqing e-commerce Internet IPO NYSE funding loss profit B2C Dangdang Peggy Yu Tiger Global HR revenue Doll Capital Management
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