Zhangmen Education, a Chinese online after-school tutoring platform, announced terms for its IPO on Thursday.
The Shanghai, China-based company plans to raise $43 million by offering 3.6 million ADSs at a price range of $11 to $13. Insiders Softbank and Genesis Capital and certain other investors intend to purchase up to an aggregate of $40 million worth of ADSs in the offering. At the midpoint of the proposed range, Zhangmen Education would command a fully diluted market value of $1.9 billion. The IPO float is just 2.3% of the basic shares outstanding, or 0.2% after indicated buying.
Zhangmen Education offers one-on-one and small-class after-school tutoring services covering all core K-12 academic subjects. The company states that it has been the largest online K-12 tutoring service provider in China by revenue since 2017 and claimed 32% market share in 2020. The company launched its Small Class program in the 3Q20, but generates most of its revenue from its flagship One-on-One program.
Zhangmen Education was founded in 2014 and booked $647 million in sales for the 12 months ended March 31, 2021. It plans to list on the NYSE under the symbol ZME. Morgan Stanley, Credit Suisse, Citi, CICC, Macquarie Capital, Futu Securities, Tiger Brokers, and Snowball Securities are the joint bookrunners on the deal. It is expected to price during the week of June 7, 2021.
