(Yicai Global) July 4 -- Shanghai Yunda Express Co., China'a third-largest courier, plans a CNY18 billion (USD2.7 billion) listing through a reverse merger with Ningbo Xinhai Electric Co. [SHE:002120] in order to tap into the capital markets.
Under the deal, Xinhai Electric will sell its assets to Yunda Express for CNY661 million. The gap will be made up when the new company issues 876 million shares at CNY19.79 each.
China's express delivery market is the world's largest and one of its most competitive. The main players are seeking to go public to secure funds from the capital markets in order to finance ambitious growth plans. Alibaba Group Holding Ltd.-backed Shanghai YTO Express (Logistics) Co. and Shentong (STO) Express Co., the top two players, have already announced backdoor listing plans through similar reverse mergers.
As of May, Yunda Express had set up over 20,000 outlets across the country and partnered with over 16,650 convenience stores, property service stations and third party units. In 2015, Yunda Express had net profit of CNY695 million on operating revenue of CNY5.05 billion.