Didi Chuxing, the Chinese ridesharing giant, has archived for an initial public offering in the US that appears to be one of the largest listings of the year.
The Beijing-based company, which applied under its legal name Xiaoju Kuaizhi, says it will trade under the Didi symbol on Nasdaq or on the New York Stock Exchange. Didi has not specified a timeline or the amount he plans to raise, but it is widely reported to target a valuation of up to $ 100 billion in his long-awaited public debut.
The company is currently valued at $ 62 billion, making it the fourth most valuable unicorn in the world (startup with a valuation of $ 1 billion or more). according to CB Insights. After a challenging 2020, when pandemic-induced lockdowns led to an 8.5% decline in revenue to $ 21.6 billion, Didi’s business is recovering strongly.
In the first three months of this year, revenue more than doubled to $ 6.4 billion and the company managed to turn a profit of $ 30 million, compared to huge losses that totaled hundreds of millions of dollars each year for the past. three years. Didi has 493 million annual active users from 15 countries, but around 90% of its revenue is still generated in China.
The company has made international expansion a pillar of its future growth. A third of the funds raised from the IPO will go towards increasing its presence in selected international markets, according to the prospectus. It will also reserve another third to invest in technologies ranging from autonomous driving to electric cars, the prospectus shows. The rest is for corporate purposes.
Founded in 2012 by former Alibaba executive Cheng Wei, Didi is known for kicking Uber out of China in 2016, when the American ride-sharing company agreed to sell its China operation to Didi in exchange for a stake in the company. Now, Cheng owns 7% of Didi. Softbank’s Vision Fund is the largest shareholder with a 21.5% stake, followed by Uber’s 12.8% stake, according to the prospectus. Chinese web giant Tencent also owns 6.8%.
In the summer of 2018, the company faced its “biggest challenge,” when two female passengers were killed while using its Hitch car-sharing service, prompting the company to suspend Hitch for more than a year and improve its measures. of security.
“In the summer of 2018, two tragic security incidents occurred on our ‘Hitch’ platform,” Chief Executive Cheng and Chairman Jean Liu wrote in a letter embedded in the prospectus. “These shook us to the core. We feel an immense sense of sadness and responsibility and we begin a period of deep self-reflection ”.
Aside from safety, the company also cited other risks in its prospectus. They include increased competition, potentially escalating tensions between China and the US, as well as stricter enforcement of China’s antitrust laws that could lead to fines or investigations.