More and more firms and investors are eyeing to get a hold of China's $8 billion logistics industry. (Photo : Getty Images)
With a target of $1 billion initial public offering, Best Logistics' IPO is poised to become this year's biggest from a Chinese firm in the U.S. listings, Yahoo Finance reported.
The logistics company is backed by e-commerce giant Alibaba Group Holding Ltd. Headquartered in Hangzhou, Alibaba's hometown, the firm was first established in 2007 by Johnny Chou, the former co-president of Google China.
Best Logistics offers local and worldwide delivery services of wide-ranging products to the country's online shoppers. Currently, it runs 400 centers in China, three warehouses in the U.S. and one in Germany.
This 2017, the company aims to set foot in neighboring markets including Japan, Thailand and Australia.
Last year, the firm was able to raise around $760 million worth of investments from companies including Foxconn, Fosun International Ltd. and Softbank China Venture. Its biggest investor was Alibaba after it purchased a 30 percent stake by investing approximately $265 million.
In general, China's logistics sector has been attracting many investors from around the globe. This industry is seen very vital in the operation of the country's lucrative e-commerce market.
Last October, Shanghai-based delivery company ZTO Express Inc. went public and raised around $1.4 billion. Its investors include Sequoia Capital China and private U.S. firm Warburg Pincus.
For industry analysts, Best Logistics is regarded as Alibaba's defense strategy against rival U.S.-based e-commerce portal, Amazon.com.
According to a report from The Financial Times, Amazon is eyeing to break into China's $8 billion logistics industry. Through Amazon Logistic+, wholesalers will now be able to ship their goods to various places in the world.
Compared with Amazon, Alibaba is only capable of providing information about logistic providers, warehouses and distribution centers. Through Best Logistics, the e-commerce giant can have the means to fortify its shipping infrastructure.
Yahoo Finance wrote that Best Logistics is expected to go public in the U.S. listings later this year.