The Chinese ride-hailing platform Didi Chuxing received a shot in the arm after receiving a funding of $500 million from U.S. travel firm Booking Holdings Inc.
The Chinese ride-hailing app has received the investment at a time when it is planning to launch an initial public offering. The platform is currently valued at $56 billion.
With this funding, the US-based travel company has signed a partnership deal with the ride-booking platform and will allow users to book Didi cabs directly from Booking’s app. Didi users will also give access to Booking Holdings’ services through its app.
For Didi, the fund will give the power to fight the battle against Uber in the new overseas market. The company has recently launched services in Mexico, Australia and Japan.
The Chinese app-based company has received around $10 billion over the past one year. With one-after-another funding, it has also become quite aggressive towards the expansion in other markets.
Didi Chuxing has also invested in other such cab-hailing companies in other markets such as Brazil’s 99, India’s Ola, Singapore’s Grab and US-based Lyft.
The development comes a month after Google invested $500 million in Chinese a sports-fashion retail company JD.com.
Experts believe that Google’s investment in JD.com was strategically placed as it wants to build partners that can assist them access wallet share from daily activities like shopping and ride-hailing (it has a shareholding in Go-Jek).
Amidst this, the partnership between Booking Holdings and Didi is also aimed at addressing the future threat rising from local behemoths in the country which are planning to enter new segments.
China’s travel booking platform Ctrip which earlier this year signalled its intention to enter the ride-hailing market, posing a potential challenge to Didi Chuxing.
The development was first reported by Reuters.