China: Ping An-backed P2P lender Lufax raises $1.3b at lower valuation

A clerk counts Chinese yuan and U.S. dollar banknotes at a branch of Bank of China in Taiyuan

Ping An-backed Lufax has raised $1.33 billion in its latest funding round from a dozen investors, at a valuation below expectations of the financial technology company, people with direct knowledge of the matter told Reuters.

The fundraising values Lufax, set up in 2011 by top insurer Ping An Insurance Group Co of China Ltd , at $38 billion prior to closing, the people said.

Lufax was aiming for a $40 billion valuation when it started raising funds in June, after postponing plans for an initial public offering (IPO) in Hong Kong.

The fundraising drew in a diverse group of investors, the people said on condition of anonymity as the information is confidential. Chinese private equity firm Primavera Capital was a lead investor, two of the sources told Reuters.

Among the main investors were Qatar Investment Authority, Hong Kong-based All-Stars Investment and Japanese financial firm SBI Holdings, the people added.

Financial institutions including JP Morgan, Macquarie Group, UBS, UOB and the private equity arm of Goldman Sachs, also joined as investors, the sources added.

Other investors included Hong Kong investment firm LionRock Capital, London-based venture capital fund Hedosophia and Hermitage Capital, an investment firm primarily focused on Russian markets, according to the people.

The fundraising amount could change if more investors join at a later stage, one of the people added.

Lufax, Macquarie, UBS and an SBI spokesman declined to comment. Hedosophia and Hermitage could not be reached, while the other investors did not respond to requests for comment.

Lufax, formally Shanghai Lujiazui International Financial Asset Exchange Co Ltd, seeks to fund growth while its Hong Kong IPO is on hold due to changing regulation in online consumer lending – a core business.

Lufax hired five banks to work on an IPO in Hong Kong to raise up to $5 billion in the first half of 2018, Refinitiv’s IFR reported last December.

It postponed the IPO as authorities formulated regulation for the fast-growing consumer lending sector under a broader campaign to curb financial risk, sources have said.

Under a proposal circulated in December, online micro-lenders will need to be licensed and will be prohibited from lending to borrowers with no sources of income or no specific purposes for the funds.

There is no clarity when the IPO plan will resume, one of the people said, adding that Lufax is looking to shift its business away from consumer lending before its IPO.

Lufax raised $1.2 billion in its last funding round in 2016, valuing the firm at $18.5 billion. Existing investors include BlackPine Private Equity Partners Fund LP, CDH Investments and Guotai Junan Securities Co Ltd, according to data provider Crunchbase.

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Reuters

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.

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.