Shenzhen-based MingZhu Logistics Holdings, one of China’s fastest-growing trucking providers, has priced its initial public offering in the US, seeking to raise up to $13 million at the midpoint of its proposed range.
According to its latest filing, MingZhu plans to offer 3 million shares at a price range of $4-4.50 apiece. At the midpoint of the proposed range, the transportation company would command a fully diluted market value of $52 million.
The trucking company has applied to trade its shares under the ticker symbol “YGMZ” on the Nasdaq Capital Market and hired ViewTrade Securities Inc as sole bookrunner on the deal.
In its prospectus, the company claims to be the second-largest transportation company in the Guangdong region. It has been offering trucking services and logistics in Guangdong and Xinjiang since 2002.
MingZhu has a fleet of 139 tractors and 90 trailers, serving third-party logistics firms, freight forwarders, warehouse operators, and other supply chain service providers.
The company said it will use the proceeds of its IPO to acquire new equipment, improve operation through new information system for fleet management, hire additional personal, finance strategic acquisitions, and for general corporate purposes.
“With the proceeds raised, we intend to carry out the strategy that will allow us to reach our mission to become China’s largest and most trusted transportation company,” the company said in its prospectus.
The company posted revenue of $20.7 million in the nine months ended September 2019, an increase of approximately 5.9 per cent from the same period in 2018.
MingZhu Logistics’s filing comes as the trucking industry in China remains one of the largest in the world. According to data cited by the company, revenue of the trucking service market in the country reached 5.16 trillion yuan ($751 billion) in 2017 from about $694 billion in 2012.
China’s trucking service market is expected to hit $829.7 billion in revenue by 2021, on the back of the country’s e-commerce boom, the company added.
Recently, Full Truck Alliance, China’s Uber-for-trucks startup, announced plans to IPO after breaking even from May 2019, Bloomberg reported.
The company, which is backed by SoftBank Group Corp. and Tencent Holdings Ltd., said its improved financial performance dovetailed with its decision not to follow through on a plan to raise as much as $1 billion in a private round, Chief Financial Officer Richard Zhang was quoted as saying.