Chinese logistics company ZTO Express is set to take on its initial public offering (IPO) in the U.S. this year, which is also seen to be the largest made by a Chinese company after Alibaba's $25-billion IPO in 2014.
Reuters said that ZTO's IPO, which is expected to raise about $1.5 billion later this month, shows how a Chinese company attracts Western investors for potential growth while avoiding red tape in launching IPOs in mainland China.
Market research firm iResearch said that 21 billion parcels delivered in China in 2015, making it the world's largest express delivery market. The total parcel volume was about 1.5 times that of the United States.
In its regulatory filing on Friday, Oct. 14, ZTO said that it is expecting to sell about 72.1 million American depositary shares, with the ranger of $16.50 to $18.50.
Reuters cited sources as saying that ZTO is aiming for a faster completion of its U.S. listing to make it easier for shareholders to monetize their shares.
In 2015, a group of investors had invested in the company which included Hillhouse Capital Management Ltd of Hong Kong and Warburg Pincus LLC, a private equity firm.
ZTO, which was established in 2002, is a major player in the country's expanding e-commerce market and serves Alibaba and JD.com, among others. Its IPO prospectus said that it had delivered nearly 14 percent of all parcels in the country last year. It has about 7,700 network partners and 74 sorting centers.
The company's sales climbed from 3.9 billion yuan in 2014 to 6.1 billion yuan ($915.8 million) in 2015. It has a net income of about 1.3 billion yuan ($200.4 million).
According to the report, ZTO will use the IPO proceeds to buy more trucks, expand its capacity by buying land, facilities and equipment and for other general corporate purposes.