Didi Chuxing, the Chinese ridesharing company, has exposed the files of a takeover bid for shares in the United States, revealing the financial damage of the pandemic to his business last year and the strength of its rebound – and paving the way for one of the biggest announcements of 2021.
Didi operates the dominant ridesharing app in China and has recently expanded across the world while investing money in electric vehicles and autonomous driving research.
Private investors previously valued Didi at $ 65 billion in a 2018 fundraiser, according to a person briefed on the matter. The company is likely to seek a higher valuation during the public offering.
Didi’s listing could rival the market debut of Korean e-commerce firm Coupang earlier this year, which was the largest U.S. public offering for an international company since Alibaba in 2014.
Didi’s revenue fell 8.5% to Rmb 141.7 billion ($ 22 billion) in 2020, according to the documents, as the coronavirus pandemic shook its core ridesharing business. The losses reached 10.6 billion Rmb during the same period.
However, activity rebounded in the first quarter of this year, allowing Didi to record a turnover of 42.2 billion Rmb and a net profit of 5.5 billion Rmb. The company lost operating money during the quarter, but made a profit including gains on investments.
The Beijing-based company said its core ridesharing business in China has been profitable on an adjusted earnings before interest, taxes, depreciation and amortization since 2019.
Xiaoju Kuaizhi, Didi’s holding company, has applied for an offer of US custodian shares on the US stock exchanges in a listing expected next month. The public debut will be a milestone for the company, which has raised billions of dollars from SoftBank of Japan while battling early competition from Uber in its home market.
SoftBank, which has invested more than $ 10 billion in Didi, held a 21.5% stake in the company through its Vision funds, while Chinese internet giant Tencent had a 6.8% stake.
Uber owned 12.8% of the company after selling its Chinese business to Didi in 2016 in a largely stock-based deal.
Didi will enter a hot market for initial public offerings, as well as a tense geopolitical environment for large Chinese tech companies at home and in the United States.
Regulators last month summoned executives from Didi and nine other freight transport and delivery companies to issue warnings about their data and pricing practices. In the filings, Didi said she faces multiple risks related to her Chinese business structure and government relations.