Uber Technologies Inc. has stated that that it plans to sell of its $6.3 billion stake in Chinese ride hailing app Didi Chuxing. According to a report by Reuters, citing inside sources, the sale is being made to raise cash for Uber as its revenues has been massively affected by the coronavirus pandemic.
Uber’s CEO, Dara Khosrowshahi is allegedly in talks with Didi and Japanese conglomerate Softbank Group Corp 9984 T about the possibility of selling off its stake in the Chinese firm. The Japanese are said to be in talks with other investors to jointly acquire the company’s Didi stake.
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The cab company had stated back in April that it expected an impairment charge of $2.2 billion against the actual value of its minority equity investment due to the massive cuts in revenue caused by the coronavirus.
Asides from its investments in Chinese Didi, Uber holds 37 percent of Russian taxi app, Yandex as well as 18 percent of Singapore’s Grab. Investments that it may have to relinquish if the coronavirus pandemic continues to bite harder.
Uber China was forced to sell most of its stock in China to Didi in 2016 after trying to break into the Chinese market without success in 2014.
Both companies are yet to go public with the deal.
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