DiDi Jumps After Second-Biggest U.S. IPO by a Chinese Company
- The company’s American depositary shares opened at $16.65, after pricing at $14 each
- The shares were up 19% to $16.63 at 1:08 p.m., giving Didi a market value of about $80 billion
Chinese ride-hailing giant Didi Global Inc. rose as much as 29% in its trading debut Wednesday after raising about $4.4 billion in a U.S. initial public offering.
The company’s American depositary shares opened at $16.65, after pricing at $14 each. The shares were up 19% to $16.63 at 1:08 p.m., giving Didi a market value of about $80 billion. Accounting for stock options and restricted stock units, the company’s diluted value exceeds $83 billion.
Didi sold 317 million shares after marketing them at $13 to $14 apiece, about 10% more than originally planned. The offering is the second largest U.S. listing by a Chinese company, behind Alibaba Group Holding Ltd.’s $25 billion debut in 2014, according to data compiled by Bloomberg.
Didi’s IPO comes in a year that’s on track to set a record for first-time share sales, with almost $351 billion raised to date. More recently, creeping inflationary pressures have injected volatility into the IPO market.
The ride-hailing company is grappling with an antitrust probe into China’s internet giants, a source of uncertainty for the firm and peers such as its major backer Tencent Holdings Ltd.
Didi, which was among 34 technology firms ordered by regulators in April to correct excesses, warned in an earlier filing that it couldn’t assure investors that government officials would be satisfied with its efforts or that it would escape penalties. In May, the antitrust watchdog ordered Didi and other leaders in on-demand transport to halt practices from arbitrary price hikes to unfair treatment of drivers.
The company plans to use the IPO funds to invest in technology, grow its presence in some international markets and introduce new products, according to its U.S. filings. It’s planning to make its debut in Western Europe this year, Bloomberg News reported in February, and has invested heavily in so-called community buying, one of the hottest e-commerce growth areas in China.
The offering was led Goldman Sachs Group Inc., Morgan Stanley and JPMorgan Chase & Co. In all, Didi appointed 20 advisers to manage the IPO. Its ADSs, four of which represent an ordinary share, are trading on the New York Stock Exchange under the symbol DIDI.
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