China’s Didi leans towards NY over HK for IPO, eyeing valuation of $100b

A woman walks past Didi Chuxing's booth at the Global Mobile Internet Conference (GMIC) 2017 in Beijing, China April 28, 2017. REUTERS/Jason Lee/Files

China’s top ride-hailing firm Didi Chuxing is leaning toward picking New York over Hong Kong for its initial public offering (IPO), eyeing a valuation of at least $100 billion via the float, two people with direct knowledge of the matter told Reuters.

Didi has also discussed the option of listing via a special-purpose acquisition company (SPAC), multiple people said, referring to a blank-check firm with capital raised in a U.S. IPO that would then merge with a target. But they said the SPAC option was seen by Didi as less viable given its valuation target.

A separate person close to Didi said the company is also considering a second listing in Hong Kong if its U.S. IPO takes place.

Beijing-based Didi, which is backed by technology investment giants SoftBank, Alibaba and Tencent, said it doesn’t have a definite plan regarding its listing destination nor timeline.

The people with knowledge of the matter spoke to Reuters on condition of anonymity as the information was confidential.

Two of them said the preference for New York as a listing venue partly reflects concerns that a Hong Kong IPO application could run into tighter regulatory scrutiny over Didi business practices, including the use of unlicensed vehicles and part-time drivers.

Shanghai authorities fined Didi for using unlicensed vehicles multiple times in 2019. Back then, Didi responded by launching a campaign to improve safety for passengers.

Another advantage Didi sees in a New York IPO is a more predictable listing pace and a deeper pool of capital as soon as the second quarter, one person said, referring to the momentum now lifting U.S. stock markets.

Hong Kong stock exchange operator HKEX said it doesn’t comment on individual companies.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.