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Childcare Portal Babytree Completes RMB 3 Bln Funding, Plans IPO

iHeima, 7/19/16

Beijing-based Zhongming Shiji Technology, operator of online childcare-focused vertical portal, e-commerce, and community platform Babytree, completed RMB 3 bln in new funding last month and has subsequently dismantled its variable interest entity (VIE) structure in order to list on China's A-shares or the Hong Kong Growth Enterprise Market, revealed Babytree chief operating officer Wei Xiaowei.

Wei said that funds will be used to repay U.S.-denominated investments in the company and will also support the creation of a parenting product business ecosystem around the Babytree platform. Wei also said that in planning its return to domestic capital markets, the company is not interested in listing on China's National Equities Exchange and Quotations (NEEQ) OTC-style agency share transfer system and will seek an A-shares market or Hong Kong Growth Enterprise Market listing instead. Prior investors such as cosmetics retail site Jumei (NYSE: JMEI), Matrix Partners, and Qianhe Capital Management have not cashed in their investments and have used their RMB funds to compensate for departed U.S.-denominated investments.

Babytree's online platform and its mobile app "Babytree Yunyu" mainly provide infant-related popular science articles, maternity budgeting advice, and community forums for new mothers. The platform also sells parental and childcare products through its self-operated e-commerce channel "Meidun Mama." The company also operates mobile SNS app Babytree Time, which includes a cloud photo album function that parents can use to upload and store baby photos. Users can also use the Babytree Time app to read articles about childcare, receive news article recommendations, and to participate in community forums and group discussions related to childcare, feelings and emotions, and celebrity gossip.

Zhongming Shiji Technology was established in March 2007 and completed USD 300 mln investment led by Jumei in July 2015.

Editor's Note: For more information on this topic, please see "Rumor: Online Childcare Portal Babytree Solicting Pre-IPO Funding," MD 3/14/16 and "Jumei Makes Strategic Investment in Babytree," MD 7/22/15 issues.

Keywords: Wei Xiaowei e-commerce Internet IPO funding BabyTree online childcare vertical portal Zhongming Shiji A-share

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