Vietnamese e-commerce company Tiki has raised 1 trillion dong ($43.5 million) through a corporate bond sale to meet its short-term capital requirements, per a filing with the Hanoi stock exchange.
This is the first time Tiki has issued corporate bonds. DealStreetAsia had first reported Tiki’s corporate bond sale plan in May.
Issued between March 16 and June 13, Tiki’s bonds have a tenor of two years and a fixed interest rate of 13% per annum.
The Vietnamese company pledged more than 2.1 million shares as collateral for the bonds, bringing its total number of outstanding shares to nearly 23 million.
The value of each share after adjustment is nearly 603,000 dong, corresponding to the value of collateral assets of more than 1.3 trillion dong. At the price, Tiki’s valuation is determined to be about 13,800 billion dong (equivalent to $600 million).
Tiki will use the proceeds to meet working capital requirements, expand its warehouses, invest in subsidiaries, and fund advertisement and marketing campaigns, among others.
Individual investors subscribed to over 90% of the bonds. A total of 139 investors – including two organisations, 135 domestic individuals, and two foreign individuals – participated in the bonds issue.
Founded in 2010 as a platform for selling books, Tiki has since grown into an e-commerce platform operating an online marketplace, fulfilment centres and logistics network.
Last year, Tiki added new services to its portfolio, including TikiPro for the installation of home equipment and TikiNgon for fresh food delivery. The company also operates a retail unit called Tiki Trading.
DealStreetAsia has learnt that Tiki plans to make its debut on the Vietnamese stock market in 2023. The company is also looking to deepen its financial services play by collaborating with financial institutions and banks.
Last year, a proposed merger between Tiki and rival Sendo, one of the most anticipated transactions in the country’s fledgeling tech ecosystem, fell through as shareholders of both the startups did not agree on merger terms.
Tiki’s loss grew to VND1.8 trillion in 2019 as against VND757 billion in 2018, per local media reports. In 2016 and 2017, Tiki recorded a loss of VND179 billion and VND282 billion, respectively.