9 June - Chinese grocery app Dingdong Maicai, backed by investors including Sequoia Capital and Tiger Global Management, said it plans to raise close to $500 million in its U.S. IPO to compete in a crowded sector, three people with direct knowledge of the matter told Reuters.
The company filed for IPO on Tuesday but did not give any details of the size of the issue or valuation.
Dingdong is targeting a valuation of at least $6 billion in the offering, said two of the people who declined to be named because of the confidentiality of the information.
However, a valuation target is not finalised and could change based on market feedback, they cautioned.
Dingdong plans to open books for the IPO in two weeks and a listing could take place as early as the end of June, said two of them.
Dingdong Maicai did not reply immediately to a question on comment.
The COVID-19 pandemic has fueled online demand for fresh produce in China with major retailers including Dingdong, Alibaba Group and Pinduoduo competing aggressively to grab a slice of this large market.
Another of Dingdong's competitors MissFresh, backed by Tencent Holdings, also filed for a U.S. IPO on Tuesday.
Established in 2017 in Shanghai, Hangzhou operates mainly in first-tier cities such as Shanghai, Beijing, Shenzhen and Shanghai.
SoftBank Vision Fund raised $330 million in a funding round last month, bringing its total raised to over $ 1 billion.
The company has opened the latest round at $5.1 billion, said one of the people. Reuters reported that Dingdong was valued at $2 billion in a $300 million funding round a year ago, according to the time.
According to a company filing, Dingdong plans to list its shares at the New York Stock Exchange under the name DDL.
Dingdong said Morgan Stanley, BofA Securities, Credit Suisse and Mission Capital are the underwriters for the offering. The new book: