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Meituan raises $ 10 billion for self-propelled drones

Hong Kong (AP) – Chinese food supply giant Meituan has raised nearly $ 10 billion by selling convertible bonds, additional shares, and plans to invest in the development of delivery technology.

The Beijing-based company, which is China’s largest food supplier, said in a bid on the Hong Kong Stock Exchange that it had sold 187 million additional shares for $ 273.80 each for recharging, raising about $ 6.6 billion.

The company also raised nearly $ 3 billion in two tranches of convertible bonds, adding an additional $ 400 million by selling more shares to Tencent Holdings, its largest shareholder.

Over the past year, Meituan has invested aggressively in grocery գն buying community groups as it competes with competitors like Alibaba և Pinduoduo in these hotly contested areas.

Meituan is valued at about $ 217 billion. It says it plans to spend the money it raised on the development of self-propelled vehicles, unmanned aerial vehicles and other technologies.

Consumers living in the same neighborhood can group together to buy large quantities of groceries or other items for group discounts. The model is especially popular in small Chinese cities, it is attractive for e-commerce companies, as they can save on shipping and storage costs when it comes to large-scale purchases.

Aggressive investments are worthwhile to gain market share in these new areas of e-commerce. Meituan’s fourth-quarter profit sank 250% last year, with a net loss of 2.2 billion yuan ($ 330 million).

The rating agencies Moody’s, S&P և Fitch downgraded their results in Meituan after those results, citing low returns against the background of large investments.

Demand for Meituan shares և bonds underscores a strong investor appetite for tech stocks, even as Beijing tightens its grip on the Internet amid antitrust concerns.

Earlier this month, Beijing slapped China’s largest e-commerce company Alibaba Group Holding for a record $ 2.8 billion in antitrust conduct, while various other companies, including Tencent and Baidu, were fined for not owning or disclosing investments in other companies.

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