For Apple (NASDAQ: AAPL), the fruits of its Chinese investment may come sooner than it hoped. It put in $1 billion in May on Didi Chuxing, the ride sharing app in May. The app is now planning its Initial Public Offering or IPO in New York. Not a single decision has been made when it came to banks or exchanges.
The timing of the Didi IPO depends on how the Chinese company's fight with American Uber Technologies Inc. fairs out. The IPO will jet the Chinese company ahead of Uber. The latter wants to stave off any public holdings for an extended period of time.
Didi has enjoyed secured funding from a number of top-flight backers during the preceding years. Other than Apple, the list of other investors includes Tencent and Alibaba. Analysts have valued the company over $20 billion.
In case Didi's IPO becomes a successful one, it will be the largest listing by any Chinese company from the time Alibaba listed in 2014. However, in its statement, the company denied any plans or any schedules for its IPO.
Didi is, at present, the largest ride hailing app in China. It is concentrated on the process of raising approximately $3 billion of funds. This figure is inclusive of the $1 billion contribution by Apple. This Cupertino-based company's investment had increased the valuation of the company to $26 billion. The ride sharing company presently operates in about 400 Chinese cities and hopes of breaking even in at least half of them.
Uber, on the other hand, spends a lot of money to get both riders and drivers. If analysts were to be believed, Didi could face pressure from a few investors who prefer to see their investments giving returns. On matters of IPO, the Chinese upstart has not yet decided on the banks and exchange to hire at this point of time.
Didi came into existence in 2015 when separate apps giving support by Alibaba and Tencent were compelled to merge after losses mounted due to tough competition. The company now pays 14 million drivers registered in it. These drivers deliver in excess of 11 million rides every day.
The present value of Uber is $62.5 billion. It is worldwide the largest ride sharing app. However, Didi dwarfs Uber China, with the latter trying to turn wheels in about 100 cities in India. The San Francisco -headquartered company, now makes a billion yearly profit from 30 of its biggest markets.