BEIJING, April 10, 2015 /PRNewswire/ -- China's leading local services e-commerce platform www.55.com (hereafter referred to as "WOWO" or "the company") (the former 55tuan.com), April 8 US time, listed on the NASDAQ stock exchange under the ticker symbol "WOWO" at a price of $10 per share. The initial public offering reached 4 million American depository shares, with each share equal to 18 shares of the company's common stock, raising $40 million in financing. At the same time, the company chose a new name: WOWO.
WOWO is the first Chinese company to be listed on a US stock exchange this year. It is also the first China-based Internet firm to be successfully listed in the US since the Chinese Ministry of Commerce issued the PRC Foreign Investment Law (Draft for Comments). As the company is described as an online to offline (O2O) business, it is as already being described in the media as "China's first O2O IPO".
WOWO first submitted a prospectus to the Securities & Exchange Commission (SEC) on January 10, 2015, in which WOWO stated its commitment to providing an online sales platform for local service businesses across China. Through the website www.55.com and the mobile app, the company provides local service providers with a platform where they can open online stores and sell their services or products directly to the end-consumer. In that the company has assisted many local service businesses in launching stores online, WOWO is frequently compared to Tmall by industry insiders. The only difference between the two platforms is that Tmall serves sellers of tangible goods whereas WOWO works for the local services sector.
The Chinese Ministry of Commerce issued the PRC Foreign Investment Law (Draft for Comments) on January 19, 2015, seeking feedback from the general public in an open forum. As WOWO is the first IPO application from a Chinese Internet firm, US regulators paid it particularly close attention. After several rounds of talks between WOWO and the SEC, WOWO was finally given approval. The experience could provide a blueprint for other Internet firms seeking to launch an IPO in the US.
WOWO's precursor 55tuan was founded in March 2010 and was once ranked among the top three portals in China's group buying sector. 55tuan rolled out an online shopping mall in early 2012, aimed at assisting businesses in setting up online stores and enabling businesses to sell services or products directly to the end-consumer. It upgraded the platform in July 2014 to allow businesses to create mobile versions of their online stores. By aligning with third-party mobile platforms including WeChat, zhida.baidu.com and Alipay service window, it enabled local businesses to manage their own marketing and sales activities directly on their mobile devices, including the management of both pricing and customer databases. By promoting the direct interaction between businesses and consumers, 55tuan succeeded in raising the brand visibility of the businesses and building the loyalty of their customers. The services offered by WOWO are transforming China's local service providers including restaurants, hair cutters and beauty salons, wedding planners and various providers of entertainment into true e-commerce businesses.
Up to the third quarter of 2014, more than 100,000 businesses on WOWO's e-commerce platform had provided over 43,000 online products and services. WOWO has local teams on the ground in 150 cities across the country and 34.1 million registered users. One highlight is the high percentage of mobile users across WOWO's entire business range, with 17.3 million installations of the mobile client as of September, 2014 and 64 percent of the platform's turnover coming from the mobile segment.
According to Mo Daiqing, senior analyst at China E-business Research Center and head of its Online Retail Department, the successful initial public offering of WOWO will boost the development of mobile e-commerce. It is also drive the growth of the local services e-commerce, as overseas capital markets take notice of the market potential and the room for growth. In addition, the success of the IPO will stimulate the entire industry and shift the focus of overseas capital from comprehensive e-businesses such as alibaba and Jingdong over to the exploration of opportunities in these more defined segments across the e-business spectrum.
China's Internet industry is now facing unprecedented development opportunities. At this year's high level NPC and CPPCC sessions, the State Council put forward the "Internet Plus" initiative. Traditional industries are beginning to actively embrace the Internet and looking to integrate their online and offline activities with mobile, which, in turn, contributes to the increase of users and to the attraction of the O2O sector to capital markets. As "the first O2O IPO", WOWO is likely to succeed in obtaining more financing as well as the visibility of the brand, both of which will serve to fuel further rapid advancement. WOWO is on track to become one of the most influential O2O players in China. More Chinese companies, especially Internet firms, are likely to seek a listing in the US this year on the heels of WOWO's success.
Contact: Guo Yanhua, +86-18612758823, +86-10-59065618, [email protected]
SOURCE Wowo Limited