Phonemaker Aims at 15 Billion Yuan IPO

DreamSmart Group (“DreamSmart”), the company behind smartphone brand Meizu, is seeking to raise 15 billion yuan (US$2.1 billion) in Hong Kong later this year. It counts car maker Zhejiang Geely Holdings Group Co as its majority shareholder.

Founded in 2003 and based in Zhuhai, Meizu was one of the pioneers of MP3 players and China’s then-nascent smartphone industry. Once backed by Alibaba Group Holding Ltd, it produced trendy devices and an operating system that initially won acclaim.

In recent years Meizu has focused on artificial intelligence (“AI”), proprietary operating systems, smart wearable products and lifestyle products such as smart home appliances; the company has emphasized that it is “transitioning from the smartphone era to the AI era”.

Parent company DreamSmart is heavily investing into ecosystem planning and technical development, its own operating system, FlymeOS, has comprehensive AI capabilities which enable Meizu smartphones and products to feature a range of AI features such as AI Portal, AI-Assisted Input, AI Gallery and AI Voice. FlymeOS is an ecosystem that integrates smartphones, smart augmented-reality glasses and smart cars; it directly competes with HyperOS and HarmonyOS, the ecosystems of Xiaomi and Huawei respectively.

The company claims to have 30 million “Meizu fans” in Mainland China and looks to add more in overseas markets especially Southeast Asia and Russia.

Moving into AI and smart products will require extensive financial resources, recent statements regarding corporate development direction and fund raising had senior management stating: “There will be very aggressive plans”. Aggressive plans backed up with ample capital would surely be needed given the highly competitive AI and consumer products markets.

Further details about the IPO and the deployment of raised funds are expected in the coming weeks.