Atour Lifestyle Holdings Limited Announces Proposed Registered Secondary Offering of American Depositary Shares by Legend Capital
Atour Lifestyle Holdings (NASDAQ: ATAT) has announced a proposed secondary offering by Legend Capital of 10,000,000 American Depositary Shares (ADSs), each representing three Class A ordinary shares. The underwriters have a 30-day option to purchase up to 1,500,000 additional ADSs. Atour will not receive proceeds from the sale. Post-offering, Legend Capital will own approximately 7.6% of Atour's share capital, assuming no additional ADSs are purchased. Director Hongbin Zhou, appointed by Legend Capital, will resign following the offering. BofA Securities, CMB International Capital, and Citigroup Global Markets are joint bookrunners. The offering will proceed under a shelf registration statement filed with the SEC.
- Legend Capital's secondary offering involves 10,000,000 ADSs, indicating significant institutional interest.
- The secondary offering is managed by reputable underwriters like BofA Securities, CMB International Capital, and Citigroup Global Markets.
- Legend Capital will retain a 7.6% stake in Atour, showing ongoing investment interest.
- Atour will not receive any proceeds from the secondary offering, meaning no direct financial benefit.
- Resignation of director Hongbin Zhou may signal potential governance changes or instability.
- Potential dilution risk exists if underwriters exercise the option to buy an additional 1,500,000 ADSs.
Insights
The proposed secondary offering of 10,000,000 American depositary shares (ADSs) by Legend Capital is significant for several reasons. Firstly, it's worth noting that Atour Lifestyle Holdings Limited will not be receiving any proceeds from this sale. Instead, Legend Capital is divesting part of its stake. This could signal various strategic financial moves from Legend Capital, such as rebalancing its portfolio or capitalizing on a favorable market condition.
Such secondary offerings are often scrutinized by investors as they may lead to a dilution of share value. However, in this case, the dilution impact is muted as the shares are already in the market and it's a transfer of ownership rather than an issuance of new shares. Investors should monitor how this divestiture impacts the stock price and market perception.
The underwriters—BofA Securities, Inc., CMB International Capital Limited and Citigroup Global Markets Inc.—are credible names, which adds a level of confidence to the offering process. Still, the fact that the company won't get direct financial benefits from this secondary offering might be seen as a missed opportunity to raise capital for growth or debt repayment.
Lastly, the resignation of Mr. Hongbin Zhou, a director appointed by Legend Capital, is also noteworthy. Such changes in board composition can sometimes impact the strategic direction of the company, although it's often a procedural move in situations involving significant share divestments.
The implications of Legend Capital's secondary offering of Atour Lifestyle Holdings Limited's ADSs extend beyond immediate financials. From a market perspective, Legend Capital reducing its stake to approximately 7.6% reflects a possible shift in confidence or a need for liquidity. For retail investors, this could be interpreted as a signal to closely watch management's next steps and market reactions.
Moreover, the involvement of well-established institutions as underwriters can be a double-edged sword. On one hand, their endorsement can reassure investors about the offering's credibility. On the other hand, it can also attract more sophisticated, institutional investors, potentially increasing market volatility in the short term.
Retail investors should also consider the broader market sentiment and geopolitical factors affecting Chinese companies listed in the U.S., including regulatory scrutiny and market access issues. This event offers an opportunity to assess the overall stability and growth prospects of Atour in its competitive landscape within China's hospitality and lifestyle sector.
SHANGHAI, CHINA, June 10, 2024 (GLOBE NEWSWIRE) -- Atour Lifestyle Holdings Limited (“Atour” or the “Company”) (NASDAQ: ATAT), a leading hospitality and lifestyle company in China, today announced the commencement of a proposed registered underwritten offering by entities affiliated with Legend Capital (“Legend Capital”) of American depositary shares (the “ADSs”), each ADS representing three Class A ordinary shares of par value US
Immediately after the completion of this Secondary Offering, Legend Capital will beneficially own approximately
BofA Securities, Inc., CMB International Capital Limited and Citigroup Global Markets Inc. act as the joint bookrunners for the proposed Secondary Offering.
The proposed Secondary Offering will be made pursuant to an effective shelf registration statement on Form F-3 filed with the U.S. Securities and Exchange Commission (the “SEC”), which is available on the SEC’s website at www.sec.gov. A preliminary prospectus supplement and accompanying prospectus related to the proposed Secondary Offering have been filed with the SEC and are available on the SEC’s website at www.sec.gov. Copies of the prospectus supplement and the accompanying prospectus related to the proposed Secondary Offering may be obtained by contacting BofA Securities, Inc., One Bryant Park, New York, NY 10036, United States of America, Attention: Prospectus Department, telephone: +1-800-294-1322, email: dg.prospectus_requests@bofa.com; CMB International Capital Limited, 45F, Champion Tower, 3 Garden Road, Central, Hong Kong, Attention: CMBI ECM, telephone: +852-3761-8990, email: ECMs@cmbi.com.hk; Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, or by telephone at +1-800-831-9146, or by emailing prospectus@citi.com.
This press release shall not constitute an offer to sell, or a solicitation of an offer to buy, the securities described herein, nor shall there be any offer, solicitation or sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About Atour Lifestyle Holdings Limited
Atour Lifestyle Holdings Limited (NASDAQ: ATAT) is a leading hospitality and lifestyle company in China, with a distinct portfolio of lifestyle hotel brands. Atour is the leading upper midscale hotel chain in China and is the first Chinese hotel chain to develop scenario-based retail business. Atour is committed to bringing innovations to China’s hospitality industry and building new lifestyle brands around hotel offerings. For more information, please visit https://ir.yaduo.com.
Safe Harbor Statement
This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward- looking statements. In some cases, forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to," or other similar expressions. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.
Investor Relations Contact
Atour Lifestyle Holdings Limited
Email: ir@yaduo.com
Piacente Financial Communications
Email: Atour@tpg-ir.com
Tel: +86-10-6508-0677
FAQ
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