Chinese state-backed steel platform Ouyeel moves towards A-share IPO

Photo: Reuters

Ouyeel, a business-to-business (B2B) steel e-commerce platform launched by state-owned iron and steel producer China Baowu Steel Group, has moved towards an initial public offering (IPO) on the mainland A-share market.

The company, which competes with VC-backed domestic counterpart Zhaogang.com, entered into a pre-listing tutoring agreement with Chinese investment bank CITIC Securities on July 24 and filed the development with the country’s securities regulator China Securities Regulatory Commission (CSRC) on July 28, according to an update on the CSRC website yesterday.

Ouyeel is still in the early phase of the IPO process, which will be followed by procedures including due diligence, submission of the prospectus, reviews and approval from the regulator, and pricing that could take several months on the A-share market depending on its targeted IPO location. The firm has yet to decide on the listing board and IPO offering size.

Founded in February 2015 and named after Ou Yezi, a legendary sword-making master in ancient China, Ouyeel operates as an online platform that enables online trading of steel products among corporate clients.

Powered by the Internet of Things (IoT), big data, and mobile Internet, the platform recorded an annual online transaction volume of 230 million tones (230 billion kilograms) of steel in 2019, up 95 per cent compared to one year earlier, shows the company website.

Ouyeel had a series of mixed-ownership reforms before it kicked off the IPO preparation work.

The company raised about 2.02 billion yuan ($290 million) in a round of equity financing from eight investors in June 2019. These investors included China Merchants Venture, an investment unit of state-owned conglomerate China Merchants Group, Beijing-based CCB Investment Funds Management, among others.

In May 2017, its initial equity investment of 1.05 billion yuan ($151 million) was completed with capital injections from investors including Singapore-based logistics major and real estate fund manager GLP.

Ouyeel’s major competitor Zhaogang.com, which is backed by top-notch investors like Sequoia Capital China and IDG Capital, filed an IPO prospectus with the Hong Kong Stock Exchange (HKEX) in June 2018. But the company scrapped the listing plan in May 2019 due to unspecified reasons.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.