Didi Chuxing, the China-based ride hailing service backed by corporates SoftBank, Apple, Alibaba, China Life, Tencent, Booking Holdings, Ping An, eHi and Sina Weibo, filed for an initial public offering yesterday.
Reports last year suggested the company may choose Hong Kong, but Didi has instead selected the US. It has used a $100m placeholder figure for the filing and has not yet determined whether it will list on Nasdaq or New York Stock Exchange.
Reuters estimated the company could seek as much as $10bn in proceeds for a valuation of $100bn, though the Wall Street Journal has put the figures at around $7bn and $70bn, respectively.
Founded in 2012, Didi operates an on-demand ride service that dominates in its domestic market of mainland China but is also available in more than a dozen countries around the world.
It has also spun off an autonomous driving technology developer and bicycle rental service Qingju, both of which are backed by Didi shareholder telecoms group SoftBank.
Carmaker Toyota supplied Didi’s last funding, investing $600m in 2019. That investment took Didi’s total equity and debt financing to $18.3bn and came a year after online travel booking service Booking Holdings had injected $500m.
Didi’s shareholders also include China Merchants Bank, Bank of Communications, Mubadala Investment Company, Silver Lake Kraftwerk, DST Global, Matrix Partners, Tiger Global Management, New Horizon Fund, GSR Ventures, Citic PE, BlackRock, China Investment Corp, Temasek, Capital International Private Equity Fund and Coatue Management.
Didi expects to use about a third of proceeds from the IPO to invest in technology development, including electric and autonomous vehicles, another third in expanding further internationally and a fifth to launch new products and bolster existing offerings.
SoftBank Vision Fund currently holds a 21.5% stake in the business, while ride sharing provider Uber owns 12.8% – which it acquired when it merged its Chinese operation with Didi. Tencent owns a 6.8% shareholding in Didi.
Goldman Sachs, Morgan Stanley, JP Morgan Securities and China Renaissance Securities have been appointed as underwriters.
