Singapore-based Internet giant Sea announced its plans to raise over US$2 billion by issuing American Depositary Shares (ADSs).
Photo credit: Sea
It proposed to offer 11 million ADSs and offer underwriters a 30-day option to purchase up to an additional 1.65 million shares. With the offering, the company would raise US$2.2 billion at the closing price on Wednesday. The total amount would be bumped up to US$2.6 billion counting the additional shares.
The company plans to use the proceeds from the offering for business expansion and other general corporate purposes, including potential strategic investments and acquisitions, according to the company’s statement.
The development comes after Sea was given a digital bank license by the Monetary Authority of Singapore. Other companies that won authorization are the Grab-Singtel consortium, Ant Group, as well as a consortium comprising Greenland Financial Holdings, Linklogis Hong Kong, and Beijing Co-operative Equity Investment Fund Management.
The internet giant could use the new capital for its digital bank or to invest in ecommerce and gaming sectors, according to Bloomberg intelligence analysts Matthew Kanterman and Joyce Ho.
“Sea is tapping the market at an opportune time we believe, given its 5x share price gains this year,” they wrote. Currently valued at over US$100 billion, Sea’s share price increased by more than 400% this year.
Last month, the company announced that it generated US$1.2 billion in total revenue and US$407.6 million in total gross profit for the third quarter of 2020.
Editing by Miguel Cordon and Jaclyn Teng
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