China's biggest ride-hailing firm to list U.S. stock market IPO

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China's biggest ride-hailing firm to list U.S. stock market IPO

Didi Chuxing, China's biggest ride-hailing firm, on Thursday made public its filing to buy a U.S. stock market listing, setting the stage for what is expected to be the world's first initial public offer this year.

The company - who was backed by Asia's largest technology investment firm, SoftBank, Alibaba and Tencent - did not reveal the size of the offering, but sources familiar with the matter have previously told Reuters that the ride-hailing giant could raise around $10 billion and seek a valuation of close to $100 billion.

At this valuation, Didi's stock market flotation would be the biggest Chinese share offering in the US since Alibaba raised $25 billion in its 2014 IPO in 2014.

Didi revealed slower revenue growth for 2020, due to the impact of the COVID 19 pandemic that grounded the global ride-hailing industry to a halt as lockdowns were enforced all around the globe.

Didi reported revenue of 141.7 billion yuan for 2020 in 2020, down from 154.8 billion yuan a year earlier. Net loss stood in 2020 at 10.6 billion yuan, compared to 9.7 billion yuan a year earlier.

Didi reopened 2021 strongly however, as businesses reopened in China. The sales more than doubled for the three months ended 30 March to 42.2 billion yuan from 20.5 million yuan a year earlier.

Didi filed for its IPO in April. A source familiar with the matter on Thursday said Didi was likely to go public in July.

The huge IPO highlights the lucrative business opportunity presented by Asian tech giants for Wall Street's big investment banks.

Earlier this year the biggest ride-hailing firm Altimeter, struck a $40 billion deal with a special purpose acquisition company backed by the investment firm Grab to go public in the United States.

In 2018, Chinese companies raised $12 billion from United States listings, more than triple the number of raised dollars in 2017, according to Refinitiv data. The increase in United States from Chinese exchanges is expected to exceed last year's tally comfortably this year.

Didi, which merged with then main rival Kuaidi in 2015 to create a smartphone-based transport services giant, counts as its core business a mobile app, where users can hail taxis, private cars, car-pool options and even buses in some cities.

Didi plans to list American depositary shares either on Nasdaq or in the New York Stock Exchange under the name DIDI, the company said.

Cheng Wei said last year the company aims to have 800 million online users globally by 2022 and complete 100 million order a day including ride-sharing, bike and food delivery orders.

J.P. Morgan, Morgan Stanley and Goldman Sachs are the underwriters for the offer.

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