(Yicai Global) April 22 -- Chinese influencer incubator Ruhnn Holding has completed its shrunken privatization two years after the unprofitable firm went public on the Nasdaq.

Ruhnn merged with a unit of Runion Holding, the Hangzhou-based firm said in a statement yesterday. The offer priced each American depository share at USD3.50, less than a third of the initial public offering price.

Ruhnn’s stock price [NASDAQ: RUHN] slid 0.6 percent to USD3.38 on April 19, a day before the shares stopped trading. The firm went public in April 2019, pricing its equity at USD12.50.

The social media marketing company has been embroiled in scandals. One of its key influencers, Zhang Dayi, was said to be having an affair with one of Alibaba Group Holding’s senior executives, Jiang Fan. The e-commerce giant bought a stake in Ruhnn in 2016.

Moreover, over 10 US firms announced in late 2019 that they had started investigating Ruhnn on alleged financial disclosure violations, Yicai Global reported on Oct. 11, 2019.

Ruhnn’s number of key opinion leaders was 180 as of last September and they had 295 million fans on platforms such as Little Red Book, Kuaishou, Bilibili, Douyin, and Weibo.

Ruhnn’s net loss narrowed by 38 percent to CNY31.2 million (USD4.6 million) in the third quarter of 2020 from a year ago, according to its earnings report. Its revenue declined by 9 percent to CNY248.5 million (USD36.6 million).

Before the merger, Ruhnn's management team had a 44.1 percent stake in the firm and Taobao China held 7.5 percent of the equity.

Editor: Emmi Laine, Xiao Yi