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China P2P lender Lufax prepares for USD 5 bln IPO

Friday 27 November 2015 | 01:51 PM CET

Chinese peer-to-peer lender Lufax has started to gear up for an initial public offering, WSJ reports.

Lufax, which was valued at nearly USD 10 billion by investors earlier this year, has tapped Morgan Stanley and Goldman Sachs Group to lead the preparations for the initial public offering, which could take place in the second or third quarter of next year. Lufax will then be worth up to USD 5 billion.

Lufax, which connects individual investors with borrowers for loans of approximately USD 10,000, has 10 million registered users and its total transaction volume grew eightfold last year to reach USD 43.3 billion.

Lufax’s biggest backer is Chinese insurer Ping An Insurance, which has a 47.5% stake.

The company was founded in 2011 and expanded into offline lending in August when it paid USD 2 billion for consumer-lending company Puhui from Ping An Insurance. That acquisition added more than two million offline borrowers to Lufax’s platform, and has served as a sourcing channel for its loans.

What’s more, the IPO is expected to be one of the bigger deals in Hong Kong next year as Lufax looks to capitalise on investor interest in China’s fast-growing online lending market, WSJ adds.

Monthly online lending volume in China reached 120 billion yuan (USD 19 billion) in October, four times its level for the same period a year earlier, according to a report jointly published by online lender Wangdaizhijia and consulting firm Yingcan.

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