TDCX, the Southeast Asian digital customer service and marketing provider to technology firms and blue-chip companies, said on Friday that it had raised US$349 million in an initial public offering (IPO) in New York, making it only the second Singaporean company to publicly list its shares on an American bourse.
The company said it sold 19.4 million American depositary shares at US$18 a share and will begin trading on the New York Stock Exchange (NYSE) later on Friday. The company had targeted selling its shares between US$16 and US$18 a share.
TDCX has granted its underwriters the option to purchase an additional 2.9 million shares. If the overallotment is fully exercised, the gross proceeds from the offering will top US$401 million.
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The company’s offering follows Singapore gaming and e-commerce firm Sea Limited’s US$884 million IPO in 2017 and comes ahead of the highly anticipated listing of Grab Holdings, Southeast Asia’s most valuable technology unicorn, after it agreed to merge with a US-listed special purpose acquisition company (SPAC) in April. Grab plans to complete its merger in the fourth quarter.
It’s obviously a very, very exciting day and an exciting time for us,” said Laurent Junique, the company’s founder and CEO. “TDCX is the best friend to fast-growing, new economy companies. We help them to solve complex customer issues. We help them to growth their business, primarily in Asia-Pacific.”
“Moving forward, an IPO makes a lot of sense for TDCX, so we are able to pursue our expansion strategy,” he added.
Following the offering, Junique will own 86.9 per cent of the company’s shares and 98.5 per cent of its total voting power, according to the company’s prospectus. He would hold 85.1 per cent of the shares and 98.3 per cent of the total voting power if the overallotment is fully exercised.
Southeast Asia has become a fertile ground for foreign investors seeking growth companies this year, particularly as a crackdown on the technology sector in China has created uncertainty and slowed overseas listings by China’s unicorns.
In April, a blank-cheque company backed by Silicon Valley’s Altimeter Capital Management agreed to buy Grab and take it public in the US, valuing it at US$39.6 billion. In July, a SPAC backed by Hong Kong billionaire Richard Li Tzar-kai and technology investor Peter Thiel agreed to buy Singapore’s PropertyGuru Group and take it public on the NYSE, valuing it at US$1.8 billion.
GoTo Group, the company formed by the US$18 billion merger of Indonesian unicorns Gojek and Tokopedia in May, is exploring a traditional listing in Indonesia, as well as going public in the US, possibly through a SPAC.
Founded in 1995, TDCX offers customer service solutions, sales and digital marketing services and content monitoring and moderation services in more than 20 languages in 10 markets worldwide, including Singapore, the Philippines, China, India and Spain. It had more than 13,000 employees as of June 30.
TDCX has opened new markets in Colombia, Romania and India this year and plans to expand into Korea, Junique said. “More markets to come in Asia as the focus, but also we’re pursuing a global expansion,” he said.
The company reported a profit of S$44.8 million (US$33.3 million) in the first six months of 2021, compared with S$38.5 million in the prior-year period. Revenue rose 20 per cent to S$251.6 million in the first half of the year. It has been profitable for the past three years.
TDCX plans to use the proceeds to pay down its debt, expand its business into new markets and for general corporate purposes, including potential acquisitions.
“Up to now, we were a private company, self-funded,” Junique said. “Right now, what’s exciting about being publicly listed is the ability to raise funds that will help us to repay the debt, but also invest in our global expansion, invest in strengthening our network, invest in our people.”
“Smart” acquisitions are a possibility in what is a “fairly fragmented” outsourced business service provider market, but the primary strategy for the company will focus on organic growth, Junique said. “That’s where the use of proceeds is going to go,” he said.
Goldman Sachs and Credit Suisse are acting as bookrunners on the offering.
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