Meitu Inc, the Chinese firm best known for its selfie image-enhancing app, has agreed to acquire a 57.09 per cent stake in Dajie Net Investment, operator of online social networking and job hunting platform for young people in China, for HK$395.5 million ($50.4 million).
Meitu will acquire the shares from venture capital firms that are exiting the online recruitment platform. These include Northern Light Venture Capital, SBCVC, and Hotung Venture Group. Other firms exiting Dajie are Fine Talent Holdings and Wenkang.
Upon completion of the deal, Dajie Net will become a subsidiary of Meitu and will hold a 29.53 per cent share in the job-hunting platform. Rapid Recruitment Ltd and Hill Ville Ltd will hold 7.28 per cent and 6.10 per cent, respectively.
Dajie Net is mainly engaged in online recruitment through its online social recruitment platform dajie.com, which provides matching services to recruiters and job candidates.
The company was valued at approximately 520 million yen ($73 million) in its Series D financing in June 2017 and at approximately 600 million yen ($84 million) in its Series E financing in February 2018.
Based on the unaudited consolidated financial information of Dajie, the company posted net loss after tax of 26.9 million yen ($3.8 million) in the year ended December 31, 2018. It also had net liabilities of approximately 67.2 million yuan ($9.4 million).
Meitu said in a disclosure to the Hong Kong Exchange that it is interested in Dajie as the social networking recruitment platform reaches tens of millions of users and businesses powered by big data analytics.
“With over 80 per cent of the users of the Meitu Apps being under 35 years old, the Group seeks to offer Dajie.com’s professional social platform to its large user base as a value-added service to increase user engagement and stickiness,” Meitu said.
Dajie.com was founded in 2008 by Wang Xiujuan, a serial entrepreneur and business leader in the China Internet industry. After the acquisition, Wang will be appointed as chief operating officer of Meitu, reporting to the company’s CEO, and will continue to lead Dajie.
In April, Meitu announced that it was venturing into the offline skincare market as it attempts to offset the impact of dwindling app users and a money-losing smartphone business.
Meitu, which listed in late 2016 in what was then Hong Kong’s largest tech IPO in a decade, has since suffered losses and its share price has more than halved, as China’s smartphone market has run out of steam, shrinking nearly 16 percent in 2018.