Didi’s group-buying unit mulls raising $4b to boost growth plans

REUTERS/Kim Kyung-Hoon

Chinese ride-hailing giant Didi Chuxing’s community business is considering raising $4 billion to boost its growth amid increasing demand for group-buying delivery services, according to people familiar with the matter.

Didi, backed by SoftBank Group Corp., is weighing chipping in about $3 billion to Chengxin Youxuan, the people said, asking not to be identified because the matter is private. It’s also working with advisers to raise about $1 billion from outside investors for the business, the people said.

Any fresh capital will help Didi to gear up against intensifying competition in China’s community business, which allows customers to order fresh groceries in groups and get them delivered to home or their neighborhood. The country’s tech giants Alibaba Group Holding Ltd., Meituan and Pinduoduo Inc. have all launched their group-buying platforms, which have become more popular during the Covid-19 pandemic.

Community group-buying also attracted billions in startup investment. Xingsheng Youxuan, a grocery app backed by Kuaishou Technology, was valued at about $5 billion after additional investment from Tencent Holdings Ltd., Bloomberg News reported last month. Its rivals Beijing MissFresh Ecommerce Co. and Beijing DMall E-commerce Co. have also recently sought to raise fresh funds.

Didi, which defeated Uber Technologies Inc. in China, has in recent years diversified beyond its ride-hailing business, adding operations such as on-demand trucking, autonomous driving and cloud computing. The startup is close to finalizing a $1.5 billion funding round for Didi Freight, Bloomberg News reported last week.

Details of Chengxin Youxuan’s fundraising such as the size of the deal could still change as considerations are at an early stage, the people said. A representative for Didi said the company does not comment on market speculation.

Bloomberg

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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.