Xiaomi raises $1 billion in fresh funding

A poster for Xiaomi Corp products in Yichang, Hubei province. Xiaomi more than tripled global smartphone shipments to 17.3 million units in the third quarter, from 5.6 million a year earlier. [ZOU JIANPING/FOR CHINA DAILY]

Xiaomi Corp raised about $1 billion in a new funding round that values China's largest smartphone vendor at $45 billion, according to a person familiar with the matter.

The financing was led by All-Stars Investment Ltd and included Yuri Milner's DST and GIC Pte, the person said, asking not to be identified because the details are private. Joy Han, a spokeswoman for Beijing-based Xiaomi, declined to comment.

Xiaomi founder and Chief Executive Officer Lei Jun is expanding overseas and unveiling new products including an air purifier to build on growth in China, where Xiaomi overtook Samsung Electronics Co in smartphone sales. The company used a combination of high-end features and low prices to lure customers from Samsung and Apple Inc, and now is expanding into content and services.

In the third quarter, Xiaomi was the world's third-largest vendor behind Samsung and Apple Inc. Lei plans to sell 100 million phones next year.

Esther Woo, chief operating officer for All-Stars Investment, declined to comment. Leonid Solovyev, a spokesman for DST, could not immediately be reached for comment. GIC declined to comment in a text message.

Xiaomi's revenue is set to more than double this year to exceed $12 billion, according to estimates from Neil Shah, Mumbai-based research director for devices at Counterpoint Research.

At $45 billion, Xiaomi would be valued at 3.75 times sales of Shah's estimate for this year. That is higher than any publicly traded personal-computer or mobile-phone maker, according to data compiled by Bloomberg. Apple trades at 3.73 times sales.

Xiaomi does not make its own devices and relies on contract manufacturers, including FIH Mobile Ltd and Inventec Corp, to build them. The company also sells to consumers from its website to keep costs down.

Xiaomi more than tripled global smartphone shipments to 17.3 million units in the third quarter, from 5.6 million a year earlier, International Data Corp reported on Oct 29. Its market share more than doubled to 5.3 percent from 2.1 percent.

The $1 billion fundraising was reported earlier by the Wall Street Journal.