(Yicai Global) Dec. 1 -- Huafang Group, the result of a merger between two of China's biggest livestreaming platform operators three years ago, has applied for an initial public offering in Hong Kong, seeking to raise between HKD129 million and HKD166 million (USD16.5 million and USD21.3 million).

Huafang plans to offer 46 million shares on the Hong Kong Stock Exchange at a maximum price of HKD3.60 each, according to the IPO prospectus published yesterday. The offer is scheduled to close on Dec. 5 and the shares should debut on Dec. 12.

Formed by the merger of Huajiao and 6.cn in 2019, the Suzhou-based internet live entertainment firm acquired social media company Holla Group in 2020 to expand overseas. Its revenue rose 18 percent to CNY4.6 billion (USD651.5 million) last year, according to the prospectus, while net profit was CNY325 million (USD46 million), versus a net loss of CNY1.5 billion in 2020.

Huafang had 415 million registered users as of May. Last year, it ranked second among China's online entertainment livestreaming platforms in monthly active users, monthly paying users on apps and websites, and monthly usage time of apps, according to an iResearch report. It was third for revenue generated from apps and websites, the report showed.

The proceeds of the IPO are intended to further diversify and enrich Huafang's products, content, and services, realize marketing plans, carry out acquisitions and investments, and strengthen its research and development capability, the firm said.

Zhou Hongyi, founder of 360 Technology Group, is Huafang's largest shareholder with a stake of about 38 percent through Qihoo 360, Huajiao No. 1, and Huajiao No. 2. Songcheng Performance Development is the second-largest investor, owning 37 percent through Global Bacchus.

Haitong International Capital and CCB International Capital are the IPO’s joint sponsors.

Editor: Martin Kadiev