Online car rental company eHi has revealed that it paid $25m in April for an 8.4% stake in China-based taxi ordering app Kuaidi Dache, which is also backed by e-commerce company Alibaba.
The investment, disclosed as part of a filing for a $100m initial public offering eHi plans to launch in the US, was part of a series B round. As part of the deal, eHi also has a warrant buy an additional 4.7 millions shares in Kuaidi’s series C round.
The auto rental company said the purchase supports its current growth strategy, through which it is looking to enter into areas in which it does not currently operate. It’s platform will now be made avaliable through the Kuaidi Dache app.
Founded in 2006, eHi provides car rentals to corporate and consumer clients. It has a fleet of more than 15,000 vehicles and operates in more than 90 cities.
Earlier this month eHi filed to raise up to $100m in an IPO on the New York Stock Exchange. Last year it raised $100m from online travel company Ctrip.com, Ignition Partners, Jafco, Qiming Venture Partners, CDH Ventures and Goldman Sachs.
Kuaidi Dache claims to book five million trips a day and is one of China’s leading ride-ordering platforms.