How SoftBank’s six-year, $11b bet on Chinese ride-hailer Didi turned sour

How SoftBank’s six-year, $11b bet on Chinese ride-hailer Didi turned sour

FILE PHOTO: The company logo of ride hailing company Didi Chuxing is seen on a car door in Beijing, China October 18, 2018. REUTERS/Thomas Peter

Like many money-losing tech startups, dominant Chinese ride-hailing company Didi Chuxing has relied heavily on private equity financing since its inception in 2012. Through 23 rounds of financing, Didi raised more than $35 billion from nearly 100 investors, valuing the company as high as $62 billion in an August 2020 fundraising round.

China’s abrupt crackdown on Didi after its $4.4 billion U.S. initial public offering (IPO) June 30 sent its shares plunging, dealing those investors a hard blow, especially its biggest shareholder, Japan’s Softbank Group. SoftBank invested nearly $11 billion in Didi starting in 2015. As of Friday’s close, its stake was worth just around $11.2 billion, making the bet barely profitable.

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