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The Didi Chuxing IPO in Hong Kong was announced last month, but now an American IPO is happening too.
The IPO announcement was an exciting development for the company that everyone is calling the "Uber of China." In fact, this one could take over Uber's China market share entirely.
Along with being a major player in the rideshare industry, Didi plans to be a pioneer in the autonomous driving and artificial intelligence sectors.
Such potential would have many clamoring to get shares of Didi Chuxing stock. The problem, until now, was that it would have been hard to do for anyone outside China.
Now, however, a U.S. IPO is on the way. Here is what we know about the company so far, and how you may be able to get shares more easily at the IPO price.
Why the U.S. Didi Chuxing IPO Almost Didn't Happen
American retail investors already have limited access to IPO investing. But buying stocks on the foreign exchange is another story entirely.
Some American brokers offer trading on international exchanges, some don't.
You may need special help from your broker to buy international. You always have to mind exchange rates between countries, the tax implications of foreign investing, and other headaches.
That's why people were excited at the hope of an American Didi Chuxing IPO at first.
Chuxing had talked about putting its name next to the likes of Uber Technologies Inc. (NASDAQ: UBER) and Lyft Inc. (NASDAQ: LYFT), getting more capital investment from American investors. Tension between the United States and China put that on the backburner, and it seemed like this wouldn't happen at all.
Now, it looks like a different story. Didi is in fact coming to the U.S. exchanges. It just filed confidentially for an IPO with the U.S. Securities and Exchange Commission.
Can Didi Chuxing Take Over the U.S. Market?
Recently, a Southeast Asian company Grab holdings - China's DoorDash Inc. (NYSE: DASH) - said it was looking to announce a merger with a U.S. blank-check company. The sale will come to about $34 billion.
That's massive, bigger even than the $33 billion Snowflake Inc. (NASDAQ: SNOW), the biggest software IPO in history.
Alibaba Group Holding Ltd. (NASDAQ: BABA) was a similar story. China's Amazon.com Inc. (NASDAQ: AMZN) raised $25 billion in the New York Stock Exchange.
This can be expected with massive Chinese companies making IPOs in the United States. They're built to serve a population of over 2 billion people in China, and they bring the same, if not better, quality to the table as their American counterparts like Uber, DoorDash, and Amazon.
Some of these might even come to replace U.S. services.
Goldman Sachs Group Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS) will work as underwriters to get Didi stock on the American exchange.
So far, most of the information around underwriting and pricing shares is confidential. Rumor has it, Didi may go for a dual listing with Hong Kong.
A Didi IPO date has yet to be announced. But the Softbank-backed company will be another one for the books.
You're going to especially want to keep an eye on this IPO, now that Robinhood may soon give retail investors the opportunity to buy stocks at IPO price.
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About the Author
Mike Stenger, Associate Editor for Money Morning at Money Map Press, graduated from the Perdue School of Business at Salisbury University. He has combined his degree in Economics with an interest in emerging technologies by finding where tech and finance overlap. Today, he studies the cybersecurity sector, AI, streaming, and the Cloud.
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