Didi-Kuaidi raise $2 billion despite Chinese market turmoil
Didi Kuaidi, the leading taxi app business in China and Uber China rival, has raised $2 billion from existing and new investors, giving it a warchest of some $3.5 billion.
Didi Kuaidi, the leading taxi app business in China, has raised $2 billion from existing and new investors, giving it a warchest of some $3.5 billion.
Didi Kuaidi was formed when Didi Dache and Kuaidi Dache merged in February creating a business which has a virtual monopoly in the taxi app sector.
Existing investors including China’s internet giants Alibaba Group and Tencent contributed to the funding round. Reports suggest that this is the largest ever funding round by a private Chinese company.
It is also being reported in terms of what this means for Uber, despite the businesses operating in different sectors – Didi Kuaidi works with licensed taxis while Uber concentrates on private hire, although both businesses have made a move on the other’s patch.
Uber’s Chinese operations are the source of much speculation and rumour. The most recurrent ones in this context is that Uber is planning to run China as a separate business unit and has earmarked $1 billion specifically for China.
Neither story has been confirmed by Uber. Uber has a “co-operation agreement” in place with Baidu, China’s other internet powerhouse alongside Alibaba and Tencent. Baidu also has an undisclosed equity stake in Uber.
The timing of Didi’s confirmation has raised some eyebrows as well, as it comes in a week when the Chinese stock exchanges have been in freefall, despite government intervention. There are suggestions that it will be difficult for Uber to raise capital in these market conditions and that Didi lucked out by starting conversations with investors a few weeks ago, before the market tanked.
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