In the United States, Uber has brushed off questions of an IPO, but its Chinese subsidiary ‘UberChina’ might be looking to launch a domestic IPO to integrate better with the country.
Speaking to reporters, UberChina boss Liu Zhen said there was a possibility the local branch would go public. In a follow up statement, the company said “Of course there is the possibility that UberChina, which is a separate entity, could at some point list on the Chinese stock market.”
Going public in China is not a matter of money, but a matter of trust. The Chinese government and public both seem against Uber’s expansion in the country, with Didi Kuaidi promoting its own local taxi service.
China has already shut down services like Facebook, Google and Twitter in the country. It wouldn’t be that surprising to see Uber receive similar punishment, unless it can show China is valuable and necessary.
Uber could also find a higher valuation inside of China, with some major companies currently on the New York stock exchange intending to turn tail and re-list in Shanghai or Shenzhen.
Having a public company in China would hopefully stop the police raids and government backlash. It would also make UberChina more independent from the main company in the America, something China want to see.
Uber has not commented on plans to allow its Chinese branch to go public. Travis Kalanick, the head of Uber, would need to give the company the get-go before anything else happens.
In China, Didi Kuaidi dominates the private cab market with over 75 per cent share, with Uber taking the other 15 per cent. To readily compete in China, Uber needs to expand its cities, offer better rates and offer more options for driving.