Didi Chuxing, China’s biggest ride-hailing app, increased its valuation to about $56 billion after completing a new funding round of more than $4 billion, people familiar with the matter said. The financing increases its cash reserves to $12 billion and includes backing from Abu Dhabi’s Mubadala, the people said, asking to not be identified as the details are private. The company was previously said to be valued at $50 billion. Didi confirmed the $4 billion round and said it will help fund international expansion while SoftBank Group Corp. said it took part. Didi has come to dominate ride-hailing in China, driving Uber Technologies Inc. out of the market after an expensive subsidy war before turning itself into the world’s second-most valuable startup. The company has started taking steps beyond the mainland, backing Estonian player Taxify OU with a financial investment and support on technology while a push into Taiwan announced this week will be done under a franchising model.
“Didi plans to scale up investments in AI talent and technologies, to further build up its intelligent driving and smart transportation capabilities,” it said in its statement. The company said it also plans to use its latest funding to build out its network for electric cars, such as charging stations. Didi’s expansion comes at a difficult time for Uber, whose founder Travis Kalanick was replaced by Dara Khosrowshahi earlier this year after a series of scandals. These ran the gamut from a massive leak of 57 million rider and driver records to revelations that the company ran programs to spy on competitors. Uber, the world’s most valuable startup, lost $1.5 billion in the third quarter of this year, up from $1.1 billion in the prior quarter. Net revenue increased to $2.01 billion in period, up 21 percent from the previous quarter.
The Wall Street Journal reported the cash reserves and investors earlier. The new funding comes after Didi raised more than $5.5 billion in April, a round that was led by SoftBank. Matthew Nicholson, a spokesman for Tokyo-based SoftBank, confirmed the investment was by the company itself.