China's Didi Kuaidi completes $3b funding round
China-based ride-hailing app operator Didi Kuaidi has closed a $3 billion funding round, said to be the largest-ever fundraise by a private internet start-up globally.
The company - the product of a merger between one-time rivals Didi Dache and Kuaidi Dache in February - raised an extra $1 billion ont top of an initial $2 billion round at a valuation of about $15 billion in July, Wei Cheng, CEO of Didi Kuaidi, told the World Economic Forum. The company's cash reserve has now grown to more than $4 billion.
New investors in the round included China Investment Corporation (CIC), Ping An Ventures and Capital International. Existing backers, including Alibaba Group, Tencent Holdings, Temasek Holdings and Coatue Management, also participated.
The announcement came shortly after Uber CEO Travis Kalanick said the US company raised $1.2 billion for Uber China, a dedicated unit set up to address the local market. Chinese search engine Baidu and other unnamed domestic investors have participated in the ongoing fundraising effort.
China's taxi-booking space is dominated by Didi Dache and Kuaidi Dache, which continue to operate under separate brands while sharing resources and personnel. They have expanded into car-pooling, vehicle rental, designated driver services, and private car booking. Some of these services are available in at least 360 Chinese cities.
In May, Sina Corporation's social media platform Weibo Corporation invested $142 million in Didi Kuaidi.
Didi Kuaidi is in direct competition with Uber, which also now offers a variety of services in almost 20 cities in China and plans to enter an additional 100 cities over the next 12 months. Kalanick told in the Baidu World forum that Uber China will continue to focus on jobs creation and comply with the government's rules, the Financial Times reported.
A host of US-based internet companies, including Uber and Airbnb, are looking for strategic partners to help them enter the China market. This is partly because they face tough competition from domestic players, which are able to provide much more localized services to Chinese consumers.
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