South Korea’s Mirae Asset Financial Group has joined major global investors including Tencent Holdings Ltd. and Singapore’s GIC Private Ltd. in a new financing round for Meituan-Dianping, China’s top service-focused e-commerce company.

According to multiple sources from the investment bank industry on Wednesday, Multi Asset Global Investments Co., an alternative investment management unit under Mirae Asset Financial Group, has recently launched a 13 billion won ($11.5 million) private equity fund with Mirae Asset Capital Co. and other major local institutional investors to invest in Meituan-Dianping.

Although the Korean investor will own less than 1 percent of total stakes in the Chinese e-commerce platform operator, its latest investment is considered significant in that it is rare for Korean capital to take part in a pre-initial public offering (IPO) or financing of a Chinese unicorn startup led by top global institutional investors.

Nor has Mirae Asset Financial Group invested in a so-called unicorn company in China before the latest investment in Meituan-Dianping. A unicorn company refers a non-listed startup with a company value estimated at $1 billion or more. Following the latest decision, Mirae Asset Financial Group plans to seek for more investment opportunities in promising startups.

The latest financing round for Meituan-Dianping before its IPO aimed to raise about 4.5 trillion won - the largest in a startup history - and a number of global institutional investors including its existing shareholders Tencent Holdings Ltd., China’s largest Internet company and the second-largest shareholder of Meituan-Dianping, and Singapore’s sovereign wealth fund GIC Private Ltd. took part in it. U.S. venture capital firm Sequoia Capital and major investment firms in China such as Trustbridge Partners and private equity firm Capital Today also joined the latest financing.

Meituan-Dianping is China’s largest life-style online to offline (O2O) service firm. O2O business allows consumers to use services at offline shops after they purchase their services via online platforms. The Chinese O2O pioneer mainly offers flight ticket and hotel bookings, movie ticket sale, restaurant reservation, and food delivery services. Meituan-Dianping has emerged as the top O2O player in China after Alibaba-invested Meituan merged with Tencent-invested Dianping in 2015. Amid growing number of users, the service’s total transaction volume has recently reached 30 trillion won, accounting for about 40 percent of China’s overall O2O market that is worth 75 trillion won.

The O2O market in China has been growing rapidly in the past several years. According to Analysys, a market research agency in China, total transaction volume of China’s O2O market was 343.8 billion yuan ($51.7 billion) last year, up from 69.8 billion yuan in 2014 and 209.8 billion yuan in 2015. Total volume is expected to reach 591.4 billion yuan in the end of this year with sales reaching 1.03 trillion yuan.

By Song Gwang-sup and Lee Eun-joo

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