China's TV and online drama producer and distributor Strawbear Entertainment Group filed for an initial public offering on the Hong Kong stock exchange last month.
China’s largest online video platform iQiyi Inc. (Nasdaq: IQ) is one of Strawbear Entertainment’s major shareholders with a 19.57% stake via subsidiary Taurus Holding.
The company said its operation covers all TV-producing related areas, including investment, development, production and distribution of TV and Internet dramas.
China Merchants Securities International and China Securities International acted as joint book-running managers for this offering.
According to the company-commissioned Sullivan report, Strawbear is the fourth largest producer and distributor among all key players in China in terms of the number of first-run broadcast television content in 2019, with a market share of 6%.
Thanks to the growing distribution and advertising revenue, Strawbear’s revenue increased from 542.9 million yuan in the fiscal year of 2017 to 765.1 million yuan in 2019.
Major TV stations and online TV platforms are Strawbear’s main clients. According to the company's prospectus, the company is actively exploring new business opportunities with other market participants but right now, iQiyi is its single biggest client in both 2018 and 2019 and the three months ended 31st March 2020.
As of 2018, 2019, and the three months ended March 31, 2020, Strawbear’s revenues from iQiyi were 244.7 million yuan, 208.5 million yuan and 326.9 million yuan, respectively, accounting for 36%, 27.2% and 100% of company’s total revenue for the same period.