The Chinese Equivalent of Uber, Didi Chuxing, Receives $1 Billion Cash Investment From Apple – But Why?

Just last week, it was reported that Apple made a bizarre — though perhaps strategic — investment of $1 billion in the popular Chinese ride sharing service, Didi Chuxing. And while many investors were scratching their heads, wondering why the Silicon Valley tech-giant would throw such a heaping wad of cash behind the mainland Chinese equivalent of Uber, Didi Chuxing, for its part, has more than likely been popping the Cristal behind closed doors all weekend long.

Of course, with a whopping $233 billion in disposable capital to do as it pleases, Apple’s otherwise shocking monetary investment in Didi Chuxing might not be the biggest deal in the whole scheme of things — at least, perhaps the move was more strategic, investment wise, than simply sitting on the mountain of cash it’s accumulated over the last decade.

And hey, Didi Chuxing is clearly smitten in light of Apple’s generous investment — as the most recent report alleges that the Chinese ride sharing company is now eyeing a possible initial public offering in the U.S. stock market for as early as next year.

According to Bloomberg, Didi Chuxing’s foray into the U.S. stock market will likely depend largely upon the company’s competition with it’s primarily rival, Uber — even though Uber, for its part, has been pouring lots of its own cash into the booming Chinese ride sharing market in an attempt to get its foot in the door. Didi Chuxing is actually the byproduct of a merger between Didi Dachi (backed by Tencent), and Kuaidi Dache (which is backed by Alibaba), and was formed in an attempt to block Uber from penetrating the lucrative Chinese ride sharing market.

Didi Chuxing, however — despite Uber’s push and shove, still remains the most prominent (and, not to mention, profitable) ride sharing player in mainland China.

Bloomberg also reported that, although Didi Chuxing is currently in the process of finding a viable way into the U.S. stock market, the company has yet to reach a consensus on several key variables — including which U.S. banks it would hire to manage its assets, or which U.S.-based stock exchange its shares would trade under.

Despite these obstacles, however, Didi Chuxing could ultimately prove to be one of the biggest, Chinese-native, blockbuster IPOs to make its debut on the U.S. stock exchange since Alibaba back in 2014. Including Apple’s $1 billion investment, Didi is currently in the process of raising upwards of $3 billion in capital, which will render the Chinese company’s inherent, out of the gate value at upwards of $26 billion.

Apple, as is par for the course, has been relatively mum when asked by reporters about it’s reasoning for throwing so much capital weight behind Didi Chuxing; however, the Cupertino-company’s CEO, Tim Cook, did allude to the fact that its investment was made because of “a number of strategic reasons, such as a chance to learn more about certain segments of the China market.” Cook also added, after a visit this morning to the Chinese capital, Beijing, that Didi “has a very great management team, and that Apple’s objective is also environmental.”

Well played, Mr. Cook — well played, indeed.. Of course, we know well enough that Apple is a big fan and friend of the environment; however, it’s also very possible that the Cupertino-company could somehow end up selling a couple (thousand?) of its Apple Cars when they launch in a few years, right?

There’s always a strategy when it comes to conducting business, of course, and clearly Apple has a few, so I guess we’ll just have to wait and see what happens..

What do you think about Apple’s investment in Didi Chuxing? Does the Silicon Valley tech-giant have rightful intentions? Let us know what you think in the comments!