Chinese luxury eCommerce platform Secoo may soon be going private. The US-listed platform has received an offer from Li Rixue, the company’s founder, chairman and chief executive, to take the company private.
The deal would see Rixue and his affiliates acquire all issued and not-held Class A common shares for $3.27 each. The company’s stock units are currently valued at $2.96 each, which gives the platform a valuation of $209 million.
The platform was first listed on Nasdaq in 2017, but it has since seen its share price fall by more than 70 percent, Business of Fashion reported. Still, the company counts several leading fashion houses as its business partners, including Armani, Balmain, Prada and Roger Vivier.
Unlike other eCommerce platforms, the company has continued to struggle despite the recent boom in demand for luxury products in China. In Q3 2020, the company generated $212 million in revenue, a 29 percent year-over-year decline, while its net profit was $3.2 million, a 66.5 percent year-over-year decline.
Still, there are some bright spots for the company. Secoo’s total order volume increased by 7.1 percent, and its active user base increased by 7.5 percent. This resulted in a gross merchandising volume (GMV) of $637.8 million, which marked a 12.5 percent year-on-year increase.