Bloomberg
Didi accelerates IPO plans, aiming at valuation above US $ 62 billion
(Bloomberg) – Chinese giant Didi Chuxing Technology Co. is accelerating plans for an initial public offering as early as next quarter to capitalize on a post-pandemic turnaround, said people familiar with its plans. in the SoftBank Group Corp. portfolio, it targets a valuation above the $ 62 billion it secured during its last round of financing, people said, asking not to be identified discussing an internal issue. The company changed plans from an earlier target in late 2021 after its Uber-like auto claim business rebounded with China’s success in bringing Covid-19 under control. Didi could raise about $ 9 billion in what would be one of the biggest technology debuts globally in 2021. The company has not made a final decision on the location of the listing, one person said. Didi’s plans remain preliminary and the time may still take until the end of the year, depending on the negotiations. An IPO would culminate in a remarkable turnaround for a company that clashed with the first regulators and then with Covid 19. It hopes to get the same investor enthusiasm that drove technology this year’s debut from China’s Kuaishou Technology video service to the pioneer South Korean e-commerce Coupang Inc. “Didi wants to capitalize on China’s incandescent IPO market,” said Brock Silvers, director of private equity investments in Hong Kong to finance Kaiyuan Capital. Read more: Chinese Ride-Sharing Giant Didi plans to enter in Europe Didi’s president, Jean Liu, said last year that the company’s main business had already started to make small profits. Daily trips and revenue have surpassed pre-pandemic levels and are now at record levels, people said. “Didi does not comment on market speculation and does not have a defined IPO plan or schedule,” the company said in a statement. to compete with Uber Technologies Inc. Didi, which remains the dominant player in China, despite competition from companies like Dida Inc., is also looking to leverage that leadership to expand in adjacent arenas autonomously driven by electric vehicles. Kong was listed last year. “The unprofitable company thinks that a market that feels Covid’s demise is favorable, but there may be warning signs” in its expensive business and international expansions, said Silvers. Read more: Didi is close to raising $ 1.5 billion per transport unit Founded by former Alibaba Group Holding Ltd. employee Cheng Wei in 2012, Didi clashed with Uber in China for years until his rival American retreated in 2016, selling its operation in the country to its rival. Didi secured an almost monopoly, but later suffered a series of blows to his business and reputation. In 2018, a pair of murders by hired drivers spawned a regulatory investigation into their ability to police a vast network used by hundreds of millions. Its shares were traded at a 40% discount on the last valuation – even before the pandemic broke out and limited its business. Didi’s shares are trading on the secondary market for around $ 43 to $ 49 per share today, just below the $ 51 that SoftBank bought in before the government investigation, one of the people said. Supported by Tencent Holdings Ltd., Didi now operates in 14 countries outside its base, mainly in Latin America. In August, it began offering car calling services in Russia, marking its first direct foray into Europe, and is already an investor in Bolt’s OU of Technology, based in Estonia, the continent’s main rival for Uber. Didi would also be competing against apps like Gett Inc., Ola and BlaBlaCar. His debut would give another triumph to SoftBank and founder Masayoshi Son, who has profited from a series of high-profile premieres in the past few months, including Coupang and DoorDash Inc. The Japanese billionaire has made the hitchhiking greeting the cornerstone of his startup portfolio by investing more than $ 20 billion in Uber, Didi, Southeast Asia’s Grab and India’s Ola.Uber, where SoftBank remains the largest shareholder, is an example of how investor sentiment has changed from last year. The American giant saw its shares plummet at the beginning of last year, but since then they have risen several times with the prospects of an economic recovery. Filho, who received strong criticism for investment bets like WeWork, profited from the market recovery and is taking advantage of a wave of IPOs in his portfolio. The Chinese social media giant ByteDance Ltd., valued at $ 180 billion, and Tokopedia from Indonesia are yet to come. Read more: SoftBank’s son is prepared for another unexpected IPO in 2021 Son invested more than $ 10 billion in Didi, according to one of the people. The Chinese startup will not have the kind of feedback that SoftBank saw from Coupang or DoorDash. But any return on investment Didi will likely be a relief after his longstanding struggles. (Updates with the comment from the 9th paragraph analyst) For more articles like this, visit us at bloomberg.comSubscribe now to stay ahead with the most trusted source of business news. © 2021 Bloomberg LP