Chinese SaaS Provider Linkage Software Lists At Premium On STAR Market

Fintech-driven software-as-a-service (SaaS) solutions provider Linkage Software Co., Ltd on Monday made its debut on the Nasdaq-like STAR Market of the Shanghai Stock Exchange after raising 460 million yuan ($65 million) in its initial public offering.

The company, whose IPO application was approved by China Securities Regulatory Commission on April 7, issued a total of 40.01 million common shares at a price of 11.49 yuan ($1.6) each.

The stock opened at 47.5 yuan ($6.7), up nearly 324.71 per cent over the IPO price. During the trading day, its price floated ranging from 41.4 yuan ($5.8) to $6.7, and it closed at 41.93 yuan ($5.9), according to its filing with the board. 

Wuhan-based TF Securities acted as lead underwriter of the deal. 

Founded in 2003, Linkage provides cloud computing, big data, artificial intelligence (AI), internet applications, and mobile terminal solutions for sectors including securities, e-commerce, banking, insurance, property, among others. 

Outsourcing services earnings from the Japanese market accounted for nearly 82 per cent of its annual revenue for the third year in a row, per its prospectus. Linkage counts Japan’s think-tank and systems integrator Nomura Research Institute as its largest account. Its other Japanese clients include Toshiba, Fujitsu, TIS INTEC Group, Society for Risk Analysis and Daito Trust Construction. 

As of December 2019, Linkage generated annual revenue of 597 million yuan ($84 million) and 149.5 million yuan ($21 million) in net profit. Besides, it has an aggregate of 790 million yuan ($112 million) in assets under management. 

Headquartered in Suzhou, Linkage has set up divisions in Beijing, Shanghai, Wuxi, Nantong, and it has a subsidiary in Tokyo. 

Its proceeds will be allocated to build a software R&D centre as well as to facilitate its next-generation SaaS programme. 

Earlier in 2016, Linkage had closed an undisclosed Series A round funding from China-focused venture capital firm New Access Capital.