China’s Didi raises $ 4 billion in US IPO – sources

0


(Reuters) – Chinese firm Didi Global Inc raised $ 4 billion when it went public in the United States on Tuesday, placing it at the top of its stated range, according to people familiar with the matter.

FILE PHOTO: A Didi logo is seen at Didi Chuxing’s headquarters in Beijing, China November 20, 2020. REUTERS / Florence Lo / File Photo

Didi will sell 288 million US Depository Shares (ADS) at $ 14 apiece, the source said. This gives Didi a valuation of around $ 73 billion on a fully diluted basis.

The sources asked not to be identified before an official announcement. Didi did not immediately respond to a request for comment.

The New York listing, which will be the biggest sale of U.S. stocks by a Chinese company since Alibaba raised $ 25 billion in 2014, follows record IPO activity this year, as the companies are rushing to grab the lucrative valuations seen in US stock. market.

A total of 29 IPOs of Chinese companies in the United States in the first six months of the year raised $ 7.6 billion, the highest amount on record for that period, data shows by Refinitiv.[L3N2O02LW]

Didi’s IPO was hedged early on the first day of the book’s construction last week and investor books were closed on Monday, a day ahead of schedule.

The book is repeatedly covered by investors, two sources told Reuters on Tuesday.

An over-allotment option, or greenshoe, exists where an additional 43.2 million shares can be sold to increase the size of the deal.

Didi was co-founded in 2012 by Will Wei Cheng, a former employee of Alibaba, who is currently managing director. Cheng was joined by Jean Qing Liu, former Goldman banker and current chairman of the rideshare company.

The company counts SoftBank, Uber Technologies Inc and Tencent as its main funders.

Didi is also known for successfully pulling Uber out of the Chinese market after the US company lost a price war and ended up selling its China business to Didi for a stake. Liu Zhen, head of Uber China at the time, is Didi’s cousin Liu.

Like most rideshare companies, Didi was historically unprofitable, until it posted a profit of $ 30 million in the first quarter of this year. The company reported a loss of $ 1.6 billion last year and its revenue fell 8% to $ 21.63 billion in the same period, according to a regulatory filing, as business plummeted for the pandemic.

Didi shares are expected to begin trading on the New York Stock Exchange on Wednesday under the symbol “DIDI”. Goldman Sachs, Morgan Stanley and JP Morgan are the main underwriters of the IPO.

Reporting by Echo Wang in New York and Anirban Sen in Bengaluru Editing by Greg Roumeliotis and Bill Berkrot


Share.

Leave A Reply