Didi Chuxing files 'confidentially' with US regulator for IPO that could raise several billion dollars

Asia's ride-hailing start-ups are pursuing listings to take advantage of a boom in equity offerings

Didi Chuxing logo at its headquarters in Beijing. The ride-hailing company is pursuing plans to list its shares in the US. Reuters 

Asia’s top ride-hailing start-ups are pushing ahead with listing plans, as they seek to take advantage of a boom in equity offerings to fund expansion in everything from food delivery to autonomous driving.

Beijing-based Didi Chuxing has filed confidentially with the US Securities and Exchange Commission for an initial public offering that could raise several billion dollars, according to sources.

Its Southeast Asian peer Grab aims to announce a merger with a blank-cheque company in the US as soon as this week in a deal valued at more than $34 billion, the sources said.

These listings pave the way for some of the largest tech debuts globally this year as demand for ride services and ride-sharing jumped after pandemic-induced disruptions in Asia. Didi and Grab are also capitalising on a rebound in tech stocks as the Nasdaq Composite Index is again charging toward an all-time high.

Didi has tapped Goldman Sachs and Morgan Stanley as underwriters for its US listing which could value the company at as much as $70bn to $100bn, the sources said. It is raising $1.5bn through a revolving loan facility to shore up capital ahead of the share sale.

The start-up is also exploring a potential dual listing in Hong Kong at a later time, one sources added.

Didi, the Chinese version of Uber, acquired its US rival’s China business in 2016. The SoftBank-backed company is stepping up efforts to grow its presence in strategically important sectors like autonomous driving and technologies like artificial intelligence chips. It has also just raised about $1.5bn for its on-demand trucking unit earlier this year.

Separately, Singapore-based Grab has attracted backing from T. Rowe Price Group and Temasek Holdings for its planned merger with Altimeter Growth Corporation, the sources said. The firms have expressed interest in joining a private investment in public equity offering, or Pipe, to support Grab’s combination with the blank-cheque company, the sources said. BlackRock is also in talks to participate in the Pipe, which could raise about $4bn, they added.

At a valuation of more than $34bn, Grab’s deal could become the biggest SPAC merger ever, according to data complied by Bloomberg, and would see the start-up become one of the first Southeast Asian unicorns to go public through a blank-cheque company.

Didi and Grab are set to test investor appetite for the capital-intensive ride-hailing business. Uber, which raised $8.1bn in an IPO in 2019, saw its share dive in March 2020 as the pandemic led to lockdowns in major cities globally. The stock has since quadrupled and even reached a new high in February this year.

Details of Didi and Grab’s listings could still change as deliberations continue, the sources said. Representatives for Didi, Grab, Goldman Sachs and Morgan Stanley declined to comment.