In a deal that could value the ride hailing start up DidiChuxing at around $30 billion, Taiwanese electronics giant Foxconn have announced they will invest over $100 million in the Chinese Uber look-a-like.
The investment will be carried out using one of Foxconn’s subsidiaries Foxteq Holdings Inc.
Didi now have a host of influential tech companies under their list of investors which includes Uber themselves. Other notable names include Apple Inc and Alibaba Group Ltd.
Hai Precision Industry Co Ltd, the trading name for Foxconn, announced the deal in a stock exchange filing, and they said the company would own a third of a percent of Didi, one of China’s highest valued tech ventures. The cash injection would give Didi a market capitalization of over $30 billion.
The two firms said they are “looking at a range of possibilities although plans are not finalized as yet.”
Uber have had a torrid time in China, going through three years of court battles which resulted in them being bought out by Didi. In return, Uber acquired a 20% stake in the Chinese firm.
“Uber were fighting a losing battle and I think they chose the smartest way out,” said Global Co-Head of the Investment Management Division of Shizuoka Capital Wealth Management, Michael Lane, commenting on the news.
“With their $8 billion valuation, Uber would have been hit very hard if they got tied up in further litigation. Now they are part of a $30 billion company and can leave the handling of the Chinese government regulations to the local firm.”
Foxconn have also been making moves in the electric auto industry, with a significant investment in Future Mobility, a firm that is looking to rival U.S. company Tesla Motors and recently took on several executives jumping ship from BMW’s electric car unit. Environmentally friendly car sales are booming right now in China with very favourable initiatives for both manufacturers and buyers.
Apple Inc has close ties with Foxconn, being the U.S. firm’s main assembler of its iPhones. Apple came in with a $1 billion investment in Didi and they are interested in getting into the auto-industry next year, with Silicon Valley abuzz with rumours of an iCar.
