Date: June 30, 2021
News Author(s): Echo Wang, Anirban Sen, Scott Murdoch
Photo Credit: Reuters
Chinese ride hailing company Didi Global Inc (DIDI.N) raised $4.4 billion in its U.S IPO on Tuesday, pricing it at the top of its indicated range and increasing the number of shares sold, according to two sources familiar with the matter.
Didi sold 317 million American Depository Shares (ADS), versus the planned 288 million, at $14 apiece, the people said on condition of anonymity ahead of an official announcement.
This would give Didi a valuation of about $73 billion on a fully diluted basis. On a non-diluted basis, it will be worth $67.5 billion. The company is expected to debut on the New York Stock Exchange on June 30.
The increase in deal size came after the Didi investor order book was oversubscribed multiple times, one of the sources said.
Investors have been told to expect their orders to be scaled back once allocations are completed on Wednesday, according to a separate source with direct knowledge of the matter.
Didi did not respond to a request for comment.
The listing, which will be the biggest U.S. share sale by a Chinese company since Alibaba raised $25 billion in 2014, comes amid record IPO activity this year as companies rush to capture the lucrative valuations seen in the U.S. stock market.
Didi's IPO is more conservative than its initial aim for a valuation of up to $100 billion, Reuters has previously reported. The size of the deal was cut during briefings with investors ahead of the IPO's launch.
This suggests increasing investor worries about China's potential anti-trust related crackdown and a more volatile IPO environment globally in 2021, said Douglas Kim, a London-based independent analyst, who writes on Smartkarma.
"But it seems like many investors like this deal, the volatile IPO environment helped to lower IPO price and valuation looks attractive," Kim told Reuters.
Didi's IPO was covered early on the first day of the book-build last week and the investor books were closed on Monday, a day ahead of schedule.
An over-allotment option, or greenshoe, exists where another 43.2 million shares can be sold to increase the deal size.
Didi was co-founded in 2012 by former Alibaba employee Will Wei Cheng, who currently serves as the chief executive officer. Cheng was joined by Jean Qing Liu, a former Goldman Sachs banker and the current president of the ride-sharing company.
The company counts SoftBank (9984.T), Uber Technologies Inc (UBER.N) and Tencent (0700.HK) as its main backers.
Didi is also known for successfully pushing Uber out of the Chinese market after the U.S. company lost a price war and ended up selling its China operations to Didi for a stake. Liu Zhen, the head of Uber China at the time, is Didi's Liu's cousin.
Like most ride-hailing companies, Didi had historically been unprofitable, until it reported a profit of $30 million in the first quarter of this year.
The company reported a loss of $1.6 billion last year and an 8% drop in revenue to $21.63 billion, according to a regulatory filing, as business slid during the pandemic.
Its shares are due to start trading under the "DIDI" symbol.
Keywords: sterlinghousetrust.com, Sterling House Trust, SHT
Sterling House Trust is a private trust with a difference. It offers its members an exclusive and reliable platform to access unique opportunities and lifestyle services reserved for the select few. With its team of professional managers Sterling House Trust constantly scans the markets and collaborate with reliable global partners to create a portfolio of carefully curated programmes for its members. Members can access these programmes according to their individual needs, interest and financial capacity. Sterling House Trust is headquartered in Auckland, New Zealand, and has operations based in London, UK.
The Sterling House Trust platform was established with the objective of providing its members, secure access to opportunities across a range of global locations, sectors and services.
Our unique Platform was established within the framework of a trust so that the trust would have oversight and governance over the range of services and its quality. Member protection is a core principle and drive in all that we do. Our trustees ensures that the interests and quality of service provided by the Platform are always maintained at the highest standards.
The trust and its trustees provide robust oversight and is constantly on the move to identify and shortlist select opportunities in the international markets. Likewise, we apply the same stringent standards in identifying and selecting providers and professional partners to join our Platform.
The Sterling House Trust Platform utilises our international footfall and relationships to provide our members with access to a range of international opportunities via our global network which covers a broad range of sectors including:
Asset protection, international property ownership and management, alternative and direct ownership, estate planning, banking services, foreign exchange, card services, alternative investment and lifestyle services.
New Zealand Head Office
31/335 Lincoln Road,
14-16 Dowgate Hill,
England EC4R 2SU