China auto start-up picks HK over US

Chinese car maintenance start-up Tuhu backed by investors including Goldman Sachs and Tencent (0700) is shifting its proposed initial public offering to Hong Kong from the US, Bloomberg said, citing sources.

The startup, which is formally known as Shanghai Lantu Information Technology, is working with China International Capital Corporation and Goldman Sachs on the offering that could raise US$300 million (HK$2.34 billion) to US$400 million this year, Bloomberg said.

Tuhu joins a slew of Chinese companies that are choosing to list in the Asian financial hub instead of the US after Beijing cracked down on overseas listings over data security concerns and American regulators started pushing for better risk disclosures. Lalamove, a logistics firm, and Meicai, which connects restaurants with vegetable producers, are among those rerouting their IPOs to Hong Kong, Bloomberg News has reported.

Launched in Shanghai in 2011, Tuhu has become one of the major players in China's highly fragmented automotive after-market sector. Its online platform offers services such as tire and battery replacement, as well as refurbishment, according to its website.

Tuhu raised US$450 million in 2018 in a funding round led by investors including Tencent, Carlyle Group and Sequoia Capital, according to a company statement. It also counts Baidu (9888) among its early backers.

In Hong Kong, China Resources Power (0836) closed 7.69 percent lower after paring losses on reports that it will spin off its green-energy operations to raise HK$2 billion at most.

In other news, Meidong Auto (1268) slumped 15.50 percent to HK$33.25 after a plan to issue bond and new share to raise 3.53 billion yuan (HK$4.32 billion).