Ridesharing

Uber Looks To Sell Some Shares In China’s Didi Chuxing

Uber Looks To Sell Some Shares In Didi Chuxing

Uber Technologies Inc. wants to shed part of its minority stake in Didi Chuxing, the Beijing vehicle-for-hire company that calls itself the world’s leading mobile transportation platform.

Bloomberg News reported that a portion of Uber’s $6.3 billion, 15 percent stake in the Chinese company is up for grabs, as the San Francisco-based ride-hailing giant is seeking cash to improve its balance sheet and raise its own share price, sources said.

Dara Khosrowshahi, Uber’s CEO, is in talks about the sale with Didi and SoftBank Group Corp, the Tokyo-based global conglomerate who is a major shareholder in both companies, sources told the news service.

One option under consideration, Bloomberg reported, is that SoftBank would collaborate with other investors to acquire some of Uber’s stake.

Didi and Uber declined to comment.

Uber went public in May of last year with an IPO price of $45 per share. On Thursday (Sept. 17), it opened at $36.68.

In August, Uber reported second-quarter revenue of $2.2 billion, down 29 percent year over year. Its gross bookings fell to $10.2 billion, down 35 percent from the same period last year. Net losses were $1.8 billion, which included $131 million in stock-based compensation expense and $382 million in restructuring and related charges.

Last week, Uber said it will borrow $500 million to help refinance a piece of its multibillion-dollar debt load. The company had long-term debt of $6.7 billion as of the end of the second quarter at the start of August, up by $1 billion since the end of 2019, when its debt load stood at $5.7 billion. 

CNBC reported that Uber continues to fight London regulators to provide ridesharing services in the city. Last year, the Transport for London (TFL) prohibited Uber from operating, citing a “pattern of failures.”

“We found Uber not fit and proper to hold a new private hire operator’s license on 25 November 2019,” Helen Chapman, TFL’s director of licensing, regulation and charging, told CNBC in an emailed statement. “Uber has submitted an appeal and it will now be for a magistrate to determine if they are fit and proper.”

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