Didi Kuaidi makes over­seas move

China Daily (Canada) - - BUSINESS - By MENGJING mengjing@chi­nadaily.com.cn

Didi Kuaidi, China’s largest mo­bile-based car-book­ing com­pany, has made its first move over­seas by in­vest­ing in a taxi-hail­ing ser­vice provider that op­er­ates across South­east Asia.

The Bei­jing-based com­pany has in­vested in GrabTax­iHold­ings Pte Ltd, a tech firm head­quar­tered in Sin­ga­pore that pro­vides book­ing ser­vices in 26 cities in six coun­tries.

Didi Kuaidi did not re­veal de­tails of its in­vest­ment, but GrabTaxi con­firmed in a state­ment it had se­cured to­tal new fund­ing worth more than $350 mil­lion from in­vestors, in­clud­ing Didi Kuaidi, hedge fund Coatue Man­age­ment LLC, and sov­er­eign wealth fundChina In­vest­ment Cor­po­ra­tion.

Li­uQing, DidiKuaidi’s pres­i­dent, said the in­vest­ment would help the two com­pa­nies learn from each other and make fur­ther de­vel­op­ments in their re­spec­tive busi­nesses.

“Didi Kuaidi can share its ex­pe­ri­ence of pro­vid­ing mul­ti­ple trans­porta­tion ser­vices on an in­te­grated plat­form, while GrabTaxi can help us un­der­stand users in South­east Asia,” said Liu.

An­a­lysts said tak­ing eq­uity stakes in over­seas com­pa­nies rather than build­ing its own op­er­a­tion in other mar­kets was a smart move by Didi Kuaidi to in­crease rev­enue.

Wang Xiaofeng, a tech an­a­lyst at For­rester Re­search Inc, said Didi Kuaidi is al­ready the No 1 player in China’s online car-book­ing sec­tor.

“To main­tain its high-speed growth mo­men­tum, it has to come with so­lu­tions to gain new­mar­kets,” she said.

Didi Kuaidi has been ag­gres­sively ex­pand­ing its plat­form since Fe­bru­ary by launch­ing var­i­ous trans­port so­lu­tions, in­clud­ing taxi-hail­ing, pri­vate car and ride-shar­ing, chauf­feur and bus ser­vices.

“It has a grow­ing pres­ence across the en­tire trans­porta­tion ser­vice sec­tor. The ques­tion is what’s next?” said Wang, who noted that Liu Qing is well aware of what it takes to in­vest in other busi­nesses, hav­ing worked for 12 years at in­vest­ment bank Gold­man Sachs Group Inc.

Zhang Xu, an an­a­lyst with In­ter­net con­sul­tancy Analysys In­ter­na­tional, said that growth of Didi Kuaidi’s op­er­a­tion in China is ex­pected to plateau, given its al­ready dom­i­nant po­si­tion in the mar­ket.

Didi Kuaidi claimed in a state­ment on Wed­nes­day that it­nowhas99per­cent ofChina’s taxi-hail­ing sec­tor, and 82 per­cent of the chauf­fer mar­ket.

“It needs to find newar­eas of de­vel­op­ment. By in­vest­ing in a lead­ing player in South­east Asia, it can avoid com­pet­ing with ex­ist­ing play­ers, and the dif­fi­cul­ties of ad­just­ing to a new­cul­ture, a new­pol­icy en­vi­ron­ment, andto anew­group of users,” said Zhang, who con­sid­ers GrabTaxi a fast-grow­ing com­pany in a fast-grow­ing mar­ket.

GrabTaxi said the in­vest­ment would al­low it to ex­pand its widely avail­able Grab­Car pri­vate car hire ser­vice, and its GrabBike mo­tor­cy­cle tax­i­book­ing ser­vice, which is cur­rently avail­able in Viet­nam, In­done­sia and Thai­land.

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