China’s Full Truck Alliance Co. Ltd. seeks an initial public offering in New York, eyeing to raise up to $100 million in capital
Based in Nanjing, FTA provides freight solutions on its platform, connecting shippers with truckers. Citing China Insights Consultancy in the prospectus filed Thursday, the company claims to be the world’s largest digital freight platform by gross transaction value in 2020.
In March 2021, FTA counted 1.4 million active shippers on its platform. In all of 2020, it facilitated 71.7 million shipping orders with GTV of $26.6 billion. According to CIC, the company served 20% of China’s heavy-duty and medium-duty truckers last year.
FTA noted in its filing that it’s at an early stage of monetization, generating revenues from shipper membership fees, freight brokerage fees from shippers, and interests and fees from value-added services to shippers, truckers, and related participants. It also collects commissions from truckers for orders originating from certain cities.
In 2020, FTA booked $395.5 million in revenue, at a 4% increase from 2019. Losses have more than doubled to $531.9 million last year, according to the prospectus. In the first quarter of 2021, FTA recorded doubled revenues year-over-year, at $132.9 million, on widened losses of $30.2 million.
FTA’s predecessor company, Yunmanman, was founded by Peter Hui Zhang, who formerly served at tech conglomerate Alibaba Group (NYSE: BABA; HKEX: 9988), which backs a number of logistics companies. Several other top managers of FTA are or have been affiliated with Alibaba and tech giant Baidu (Nasdaq: BIDU; HKEX: 9888). SoftBank is one of FTA’s principal shareholders, holding 22.2% equity in the company prior to the IPO. Sequoia Capital is another big investor in the Chinese platform.
The proceeds from the IPO would boost FTA’s infrastructure development and technology innovation, expansion of service offerings, and other segments.
The company has attracted a slew of big banks to its listing. Securers on the offering are Morgan Stanley & Co. LLC, China International Capital Corporation Hong Kong Securities Ltd., Goldman Sachs (Asia) LLC, UBS Securities LLC, Huatai Securities (USA) Inc., Citigroup Global Markets Inc., Nomura Securities Int’l Inc., China Renaissance Securities (Hong Kong) Ltd., and CLSA Ltd.
FTA plans to list its American depositary shares on the New York Stock Exchange under the symbol “YMM.” The exact terms of its IPO are yet to be determined.
FTA’s filing closely follows the IPO filing by ForU Worldwide Inc., a Chinese freight dispatch platform known as Fuyou Trucks. While FTA claims it’s the largest in terms of GTV, Fuyou said in its prospectus that it’s China’s largest technology-driven road freight transportation platform in terms of revenue. Fuyou also has a big tech backing it – JD Logistics, a unit of JD.com Ltd. (Nasdaq: JD; HKEX: 9618). On its side, JD Logistics debuted in its IPO on the Stock Exchange of Hong Kong Friday.