TRANSPORT PLATFORM DIDI WILL HOLD BACK ON OFFERING

▶ Chinese ride-hailing service well capitalised and under no shareholder pressure for public listing at present

The ride-hailing service Didi Chuxing, which counts Apple, Japanese SoftBank Group along with Abu Dhabi’s Mubadala Investment Company as its shareholders, is well capitalised and under no pressure from the stakeholders to list its shares in the near future, according to the top executives at the company.

“There is no immediate pressure from the outside [to do the share float],” the Didi president Jean Liu said in Abu Dhabi. “Most of our investors, I would say, are very visionary and they are also quite patient. Plus we are still only five years old [company] so it’s still a young investment for a lot of them.”

An earlier Reuters report suggested Didi, based in China, is working toward an initial public offering (IPO) in the United States that would be likely to take place next year. Based on the news agency’s report, Didi would have had a $50 billion value, which would have made it as the most high-profile listing of a Chinese company in the US since Alibaba Group Holding’s IPO.

Ms Liu, however, said for Didi, the focus is expanding and strengthening the business and forging new partnerships across the globe. “We feel quite fortunate that we can focus on what we are doing on business itself.”

A share sale is “a means rather than a goal ... from our perspective [an] IPO is not a purpose,” Stephen Zhu, Didi’s vice president of strategy, explained during a joint interview. “Right now we are very well capitalised and we have enough [financial] resources to execute our strategy for the next few years,” he said. “We are not in a rush.”

Didi, the world’s largest online transportation platform with more than 450 million users and 21 million drivers, completed its latest funding round in July, raising more than $5bn from investors including Mubadala, which invested through SoftBank Group, Mr Zhu said without divulging the size of individual investments.

Ms Liu said the company does not have specific funding plans for next year. “Even for the last [funding] round, we weren’t planning for that,” she said, adding that, the investments followed a meeting between the company and SoftBank’s Masayoshi Son. “He is so passionate about what we are doing ... he shared with us his dream and we shared with him ours so it naturally clicked and fundraising happened,” she said.

The company, however, is open to partnerships.

“It’s a very young company and it’s a fascinating industry that is growing really fast, so there are a lot of different parts of strategic partnerships,” she said. “In China we have Alibaba and Tencent, in one space we have Apple, in overall industry SoftBank is a very good strong partner with us,” she noted.

The company, which dominates the Chinese ride-sharing market, has an investment in every region around the world. It has investments in Taxify, which operates in Europe and Africa; Latin America through 99 and in the US, Didi is an equity-holder in both Uber and Lyft.

Through Careem, Didi has expanded its footprint in the Middle East, however, the company is also looking for other investment opportunities.

“Everything is possible. It really depends on many different conditions, but we are a company which is very open-minded,” she said, when asked if Didi would consider increasing its stake in Careem.

Through its operations in China and its investment portfolio, Didi reaches 60 per cent of the global population in 1,000 cities across the world. The company does not operate only in the traditional ride-sharing business, it has an intelligent traffic management system that helps to reduce congestion through machine learning.

The company is also setting up vehicle management companies to better manage cars and is partnering with car makers to design and build vehicles for ride-sharing purposes, according to Mr Zhu.

For the next five years, Didi’s strategy is the ride-share network itself. The rides it completes on a daily basis account for two out of three journeys globally.

“Basically, the number of rides we complete are twice the size of other markets added together. That’s the scale of us,” Ms Liu said.

He added that the company’s penetration in the Chinese market is still 1 to 2 per cent: very low, so that is one area of the business where we “are still working really hard to improve”.