Multimedia Service Provider Leaping Group Seeks $20 Million IPO in New York
The company operates the largest pre-movie ad network in two of China's provinces and plans to expand further upon floating on Nasdaq.
Chinese multimedia service provider Leaping Group Co. Ltd. has filed for an initial public offering on the Nasdaq Capital Market, seeking to raise up to $20 million.
A Shenyang-based company, Leaping Group provides multi-channel advertising, film and TV program production, and event planning to enterprises in the provinces of Heilongjiang and Liaoning in China.
In its prospectus filed Wednesday with the U.S. Securities and Exchange Commission, the company said its ad network comprises 74 movie theaters, 50,000 elevators, and 16 supermarkets across 16 Chinese cities. That business generates the majority of Leaping Group's revenue. Since 2013, when the company launched, 287 clients have acquired advertising slots in its network. Of those, 204 were repeat customers, Leaping Group said.
Regarding its film production business, the company said it collaborates with market-leading film distributors and online entertainment services, including iQiyi Inc. (Nasdaq: IQ), to invest and distribute films and TV programs. Because the distribution of its latest TV project titled "Meet Myself" is ongoing, Leaping Group said it has not gained revenue in that sector for the past two years but expects to earn its share by June 2019.
For the year through June 2018, the company reported revenue of $5 million and net income of $2.3 million, an increase of 32 percent and 44 percent, respectively, from the same period a year earlier.
Among Leaping Group's plans is expanding its ad network into eight provinces covering first- and second-tier cities, including Hangzhou, Jinan, Nanjing, Qingdao, and Wuhan. The company said it intends to use the proceeds of its IPO to expand its network, invest in films and movie theaters, recruit senior-level employees, and invest in mergers and acquisitions within the industry.
Underwriter on the offering, Boustead Securities LLC, will have an option to sell up to an additional 15 percent of the offering, according to the filing.
The company said it has reserved the symbol "YZCM" for its listing in New York.