Banking, finance, and taxes

LexinFintech Announces Potential Pricing for IPO

Chris Lange

Published: December 18, 2017 10:05 am

Last Updated: January 12, 2020 5:21 am

LexinFintech Holdings has filed an amended F-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering (IPO). The company expects to price its 12 million American depositary shares (ADSs) in the range of $9 to $11 apiece, with an overallotment option for an additional 1.8 million. Each ADS represents two ordinary shares of LexinFintech. The company intends to list its shares on the Nasdaq under the symbol LX.

The underwriters for the offering are Goldman Sachs, Merrill Lynch, Deutsche Bank, China Renaissance and ICBC International.

This is a leading online consumer finance platform in China in terms of the outstanding principal balance of loans originated as of June 30, 2017, according to management consulting firm Oliver Wyman. LexinFintech focuses on serving the credit needs of educated young adults in China. It grows with customers by offering convenient and innovative loan products to meet their credit needs at different stages of life.

In 2016, LexinFintech had approximately 3.0 million active customers, and 3.3 million active customers in the nine months ended September 30, 2017, representing a 103% and a 34% increase from 2015 and the nine months ended September 30, 2016, respectively. As of September 30, 2017, the company had over 6.5 million customers with an approved credit line and over 20 million registered users.

Its target customer cohort, educated young adults aged between 18 and 36 in China, features young people with high income potential, high consumption needs, a strong desire to build their credit profile and an appreciation for efficient customer experience. At the end of September 2017, this target customer group represented over 90% of its customer base.

LexinFintech expects to use the net proceeds from this offering primarily for general corporate purposes, which may include investment in product development, sales and marketing activities, technology infrastructure, capital expenditures, improvement of corporate facilities and other general and administrative matters.