Uber Technologies Inc. has closed early a US$1 billion fundraising round for its China unit.
Investors include Hillhouse Capital, Asia’s biggest hedge fund, Chinese Internet giant Baidu Inc., China Citic Bank Corp. Ltd., China Life Insurance Co. Ltd., Ping An Insurance Group Co., of China among others, according to Reuters.
However, a representative of Ping An’s investment team said they did not invest in the China unit. Hillhouse was also not an investor, said a third source who declined to be identified because of the sensitivity of the subject.
A spokeswoman for Uber declined to comment.
This round potentially values Uber China at US$7 billion. The unit plans to list in the mainland by 2020.
The Wall Street Journal is reporting that winning the support of local investors could help Uber amass allies in China, its largest market outside the US and the site of its fiercest competitive challenge.
Didi Kuaidi, backed by China’s leading Internet companies — Alibaba Group Holding Ltd. and Tencent Holdings Ltd. — is racing with Uber to add millions of drivers and passengers by subsidizing the cost of trips and doling out cash incentives to drivers.
Earlier this year, Uber’s chief executive called China the company’s top global priority, and said the startup plans to spend US$1 billion this year to expand in the country.
By setting up a separate, locally funded operation, Uber aims to win the support of the Chinese government, which has historically created obstacles to expansion in the region for US technology companies.
Last year Uber formed a strategic partnership with Chinese search-engine company Baidu Inc. that included an investment in the China operations.
Uber’s service in China uses Baidu’s mapping and payments service.
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