Didi Chuxing Prepares Hong Kong Listing
Chinese ride-sharing giant Didi Chuxing Technology Co. is readying a Hong Kong IPO as investors look to cash out on the company.
The Beijing-based company's listing is being pushed by its approximately 100 investors including Japanese-headquartered SoftBank Group Corp., (OTC: SFTBY) as reported by Caixin Global today, citing a source near Didi's top executives. Between 2015 and 2018 SoftBank poured more than $10 billion into Didi and is now its largest investor. The bank also led a funding round in May that helped Didi raise more than $500 million. Some other large investors in Didi include the American smartphone heavyweight Apple Inc., (Nasdaq: AAPL) which invested $1 billion into the firm in 2016.
Previously rumors have circulated about a possible merger between Didi and food delivery giant Meituan Dianping (HKEX: 03690). Didi dismissed these rumors as false in a June Weibo post writing "Someone really dares to make things up while others really dare to believe," above a picture with a prawn dragging an egg.
According to KrASIA, the message and image create a pun on the phrase "groundless bullshit" in Chinese.
Known as the Uber of China, Didi claims to be a global leader in mobile transportation and as a "convenience platform." The company provides to more than 550 million users in Asia, Latin America, and Australia.
It's also important to note that Didi and Uber in the past had a fierce two-year battle in China over drivers and passengers before striking a deal in 2016. The two parties spent billions of dollars in a bloody fight for market share in the country; turning a profit in the has presented a challenge. Uber then conceded in 2016 by selling its Chinese operations to Didi. In exchange, Uber received roughly a one-fifth stake in Didi that has since been reduced to around 15.4. Since the agreement, Didi has been a dominant firm in China.
According to the source cited by Caixin, Didi now has more than $7.2 billion in cash. Meanwhile, the Chinese news site 36Kr reported that Didi lost $1.6 billion in 2018.
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