Former smartphone maker Meizu intends to go public
DreamSmart Group, which manufactures products under the Meizu brand, is planning an initial public offering. The smartphone maker is preparing to list on the Hong Kong stock exchange, valuing the company at USD 2.1 billion. The company has selected two banks to act as advisors for the IPO. The company has not yet announced an official date for the IPO, which will take place in 2024.
Zhejiang Geely Holdings Group owns DreamSmart. For a long time, the company was known as smartphone maker Meizu. However, it announced in 2023 that it would stop making phones. Instead, DreamSmart will focus on developing artificial intelligence. The company’s technology has applications in mobile devices.
AI is one of the most sought-after areas for investors. Meizu’s developments are also attracting the attention of major electronics manufacturers. Samsung, for example, is also interested in implementing AI solutions in its smartphones. However, the financial market is still volatile after the lull of the past two years. In addition, investors are cautious about investing in Chinese companies. This is due to several factors, including the country’s economic slowdown. Tensions with the US are also a major concern.
Business overview
The Meizu brand came into existence in 2003. Initially, Jack Wong’s company specialised in manufacturing MP3 players. However, with the advent of the mobile era, the company decided to move in that direction. In 2007, Meizu unveiled a prototype of its first smartphone on Mymobile, a Windows-based operating system. However, the phone was out of production in 2010.
Since 2011, the company has been producing Android-based devices. To strengthen its position in a new market, Meizu focused on expanding its range of models. This approach paid off, and in 2015, the technology giant Alibaba invested USD 590 million in the company. The money allowed the company to speed up the production of smartphones and improve their functionality. For example, the manufacturer divided the devices into several series:
– The M series, which produced compact devices, included budget phones;
– M1 Note, which was phablet;
– flagships of the brand went under the Pro series.
Despite the variety of models, the company did not have enough resources for mass production. As a result, Meizu did not create a wide distribution network, although it delivered products to various countries. In 2019, the brand held only 1% of the total mobile device sales market in China.
In 2022, Geely Automobile Holding acquired shares in DreamSmart from major shareholders Huang Xiuzhang and Taobao, resulting in the company owning more than 79% of the manufacturer’s securities. In February 2024, Meizu announced its exit from the smartphone market. Instead, it began developing artificial intelligence for mobile devices.
