Galaxy Payroll Group Files for IPO and Aims for $24.8M

Galaxy Payroll Group has filed for an initial public offering (IPO) in the United States.

The Hong Kong-based provider of payroll outsourcing services, employment services, and consultancy and market research services seeks to raise $24.8 million, according to its Thursday (Dec. 28) filing with the Securities and Exchange Commission (SEC).

The firm also said it has applied to be listed on Nasdaq Capital Market under the symbol GLXG.

Galaxy Payroll Group earned total revenues of about $6 million during the year ended June 30, according to the filing.

The company said in the filing that the demand for human resources (HR) outsourcing services in the People’s Republic of China (PRC) is increasing due to economic growth and growing participation by foreign enterprises.

“In light of the globalization as well as growing trend of competition and corporate transformation, the market demand of in-country HR services in the PRC has gradually increased and enterprises in service industry tend to outsource non-core business functions, including employment, payroll, tax and filing, in order to reduce administration costs and focus on core business,” Galaxy Payroll said in the filing.

The company said in the filing that its competitive strengths in serving this market demand include its engagement by multinational channels and end users from different industries, its well-established business relationships and its ability to ensure compliance with local regulations for its end users.

“We have more than seven years of experience in the payroll outsourcing service industry in the PRC and Hong Kong,” the firm said in its SEC filing. “Leveraging our industry experience and our established relationship with our major customers since our establishment, we entered into the first agreements for the provision of services in Macau, Taiwan, Japan, Australia and other Asian countries starting from 2015 till now.”

PYMNTS research has found that 80% of firms have experienced challenges in paying and managing overseas workers.

The more challenges organizations face, the more likely they are to use private agencies to assist with international worker recruitment and management.

However, even among the firms that said they did not face any challenges in managing or paying international workers, 35% said they had used private agencies to recruit international workers in the last 12 months, according to “Meeting The Demand For Cross-Border Hiring: Challenges In International Workforce Payment And Management,” a PYMNTS and NIUM collaboration.