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Lufax Closes $900m Round




By Ryan Weeks on 8th January 2016


Lufax mammoth fundraise is reportedly complete, with the platform raking in a massive $900m at a valuation of $18.5bn.

 

An investor document (written in Chinese) obtained by Tencent Technology appears to have confirmed the completion of the fundraise. The Lufax price tag has been rocketing upwards in the press of late – quite correctly it would appear. At the beginning of December, we learnt that China’s largest platform was sizing up a $1bn equity round at a valuation of approximately $15bn. It’s taken just a month for that number to balloon to the $18.5bn. The evolution of Lufax’s valuation is nothing short of extreme. The platform raised $485m in April at a valuation of $10bn, in a round led by BlackPine Private Equity Partners. Lufax is also said to be planning an IPO for late 2016, through which the platform intends to raise $5bn.

 

Lufax was founded in 2011 as a subsidiary of Ping An Insurance Company of China, with the assistance of the Shanghai municipal government. Ping An reportedly remains the platform’s largest single shareholder. The insurance company owned 47.5% of Lufax shares prior to the $900m round – which, by the way, is being called a “Series B” fundraise.

 

It’s not clear which investors led the Series B, but rumour has it that Ping An and Morgan Stanley participated. An article in China Money Network provides some clarity as to the company’s revenues. Lufax is expected to book revenues of $706m in 2015, up from $100m in the previous year. Those revenues are expected to climb to $3.1bn at the end of the new year, to $6.2bn in the following year, and to $9.8bn in 2018. For context, Prosper – the US’ second largest marketplace lender – recently logged revenues of a little over $200m in 2015.

 

Lufax made a loss of $415m in 2015, and doesn’t expect to reach profitability until 2017, when profits are slated to hit $1.5bn – $3.5bn in the following year. 

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