Didi lines up 2021 IPO in Hong Kong, targets more than $60 billion valuation

Didi V2X

China’s leading ride-hailing business Didi Chuxing is considering Hong Kong to get a multibillion-dollar first public offering next year, falling previous aims to list in New York amid rising Sino-US tension, people with knowledge of the matter said.

Didi, endorsed by tech investment giants SoftBank, Alibaba and Tencent, has begun initial discussions with investment banks for your long-awaited IPO, according to three people. It’s seeking to formally appoint lead banks for its float in the forthcoming months, 2 of them said.

The people spoke on condition of anonymity as the data, including the identity of those banks, was personal.

The people mentioned Didi is targeting a valuation of over $60 billion by the time of IPO launch, expected as soon as in the early half 2021. Founded eight years back, Didi began generating healthy gain in the second quarter this past season and a few investors are now eager to cash in, stated among the folks.

Didi is also contemplating a brand new fundraising round before the IPO at a bid to boost its viability, two of the folks mentioned. At the private secondary market, some of its stocks are trading well below a cost of $56 billion it attained at 2017.

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The new timetable for the IPO and the private fundraising round ahead of it haven’t been reported previously.

Asked by journalists at our partner news agency Reuters to remark, Didi stated it doesn’t have any “definitive” IPO plan or timeline. The people familiar with the thing cautioned the IPO plan could change because of market circumstances.

The plan comes after Didi walked away from discussions on merging with national competition Meituan, based on four individual sources, amid debate on the evaluation of the united company and management outlines. These four people declined to be identified as the information was private.

Meituan declined to comment. Didi said it hadn’t participated in any merger discussion with Meituan.

TRANSFER FROM MANHATTAN

Didi, which merged with then main rival Kuaidi from 2015 to make a smartphone-based transportation services giant, counts because its own core business a cellular app, in which users can hail taxis, privately owned cars, car-pool choices and possibly even buses in certain cities.

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Didi needed for years directed to get a U.S. IPO due to the prestige of a New York listing, the presence of comparable peers like Uber and Lyft and a deeper capital pool, according to two of those folks.

Uber and Didi have long distance connections: Uber in 2016 sold its operation to Didi in exchange for a 17.5% stake in the Chinese business, which subsequently made a $1 billion investment in Uber.

All 3 people familiar with the issue said Didi has now opted to contemplate Hong Kong for its list deteriorating US-China relations that have left tech firms like TikTok proprietor ByteDance from the crosshairs.

US-listed Chinese firms now also face tightened evaluation and stricter audit requirements .

Uninspiring inventory performances by Uber and Lyft also have discouraged Didi from looking for a US IPO, ” said two of those folks.

If finished, Didi’s IPO would likewise burnish Hong Kong’s standing as a capital markets pulse, using $28.8 billion value of IPOs and secondary listings carried out in the city between the beginning of this season and mid-October, Refinitiv information showed.

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That assisted Hong Kong catch the second place in the international stock market league table – after Nasdaq – regardless of the town reeling from a coronavirus pandemic-hit economy and anti-government protests.

Didi’s listing plan comes as Ant Group prepares to increase about $35 billion at a dual listing in Hong Kong and Shanghai in the coming weeks, in what would be the world’s biggest IPO.

The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Julie Zhu and Kane Wu. Additional reporting by Yingzhi Yang in Beijing. Editing by Sumeet Chatterjee and Kenneth Maxwell.

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