Chinese bidder Didi Global Inc. raised $ 4.4 billion at its IPO in the United States on Tuesday, pricing it at the top of the target range and increasing the number of shares sold, according to two sources familiar with the matter.
Didi sold US $ 317 million in stock (ADS) for $ 288 million at $ 14 a share, according to people on condition of anonymity before an official announcement was made.
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That would give Didi a valuation of about $ 73 billion on a fully diluted basis. On an undiluted 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 the size of the trade came after the over-entry of Didi investor order book, according to one of the sources.
Investors were informed to wait for their orders to decrease as soon as the distributions are completed on Wednesday, according to a separate source with immediate knowledge of the matter. Didi did not respond to a request for comment.
The list, which will be the largest U.S. stock sale by a Chinese company since Alibaba raised $ 25 billion in 2014, comes amid record IPO activity this year as companies rush to record lucrative stock market valuations. of the USA.
Didi’s IPO is more conservative than its original target of up to $ 100 billion, Reuters reported earlier. The size of the deal was reduced during investor briefings before the start of the IPO.
This suggests that investor concerns are growing about a possible crackdown on China’s confidence and a more volatile IPO environment in the world in 2021, said Douglas Kim, an independent London-based analyst who writes for Smartkarma.
“But it seems that many investors like this deal, the volatile IPO environment has helped lower the IPO price and the valuation looks attractive,” Kim told Reuters.
Didi’s IPO was covered early on the first day of book creation last week and investors’ books closed on Monday, a day ahead of schedule.
There is an over-distribution option, or greenshoe, where another 43.2 million shares can be sold to increase the size of the deal. Didi was founded in 2012 by former Alibaba employee Will Wei Cheng, who currently serves as CEO. Cheng was accompanied by Jin King Liu, a former Goldman Sachs banker and current chairman of the utility company.
The company considers SoftBank, Uber Technologies Inc and Tencent as its main supporters.
Didi is also known for successfully ousting Uber from the Chinese market after the US company lost a price war and ended up selling China’s operations to Didi for a stake. Liu Zhen, the head of Uber China at the time, is Didi’s cousin.
Like most companies, Didi was historically unprofitable until it reported a $ 30 million profit 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 businesses fell during the pandemic.
Its shares are going to start trading with the “DIDI” symbol.