Women shopping e-commerce platform, Mogujie.com, and women social networking platform, Meilishuo.com, are to merge through a cash and share exchange, reports Tencent Tech on Friday.
This rumor has been going around since the beginning of January and according to an anonymous informant, the new company will be in the hands of Mogujie CEO, Chen Qi. Xu Yirong, Meilishuo’s CEO will be in charge of the overseas shopping business his platform, before his expected departure in the near future.
The latest leaks suggest that Xu will likely devote his attention to his new ‘HIGO’ business, an overseas shopping platform born out of Meilishuo in 2014.
Rumor also has it that Hillhouse Capital and Tencent have promised to further invest in the combined new company with no less than USD 250 million, wishing it to head for an IPO in 2016.
“Mogujie and Meilishuo had no choice but to merge given the current climate. Bigger tech companies like Meituan/Dianping, 58/Ganji and Ctrip/Qunar combined for survival, and smaller companies are feeling the heat too,” an anonymous source told Tencent.
“Due to our overlapping businesses and relatively small scale, our merger might result in a more flat effect compared with previous big tech mergers.”
Founded in 2011, in Hangzhou, the city home to Alibaba, Mogujie is a service targeted at fashionable women. What started with trendy clothes, shoes, bags and accessories, later transformed into a shopping guide and e-commerce site, with a social network for users to share their shopping experience and recommendations. In November 2015, it completed a Series D financing of over USD 200 million, led by Ping An Ventures.
Founded in 2009, Meilishuo was early to the game, and has more than 100 million female registered members ranging from 18 to 35 years old, says its official site. As of June 2014, Meilishuo had over 10,000 retailers registered to its platform, and has completed five rounds of financing, raising USD 250 million from Tencent, GGV Capital and Sequoia Capital, among others.