Uber is seeking a $2 billion loan from four of the world’s biggest banks to add to an already huge collection of cash. The startup and its Chinese rival, Didi Chuxing Technology Company, are in an arms race to be the premier global option for ride-sharing services.
Uber announced in June it had garnered $3.5 billion from Saudi Arabia’s Public Investment Fund, which was considered one of the largest fundings for a private start-up ever. Now, Uber is looking to utilize a financial tactic, known as a leveraged loan, which would allow the company to raise money from multiple financial institutions without decreasing current valuation.
Uber is valued at $62.5 billion, while, according to CNBC, Didi is worth “upwards of $20 billion.” In June, 2015, Uber CEO Travis Kalanick sent a letter to investors expressing the urgency of further infiltrating Didi’s own backyard. Kalanick stressed that “simply stated, China is the #1 priority for Uber’s global team.”
Some of the biggest investment companies are actively assisting Uber “in raising debt and equity in hopes of securing a role on an eventual initial public offering.”
The $2 billion leveraged loan could help the company get a step closer to a strong showing on Wall Street, but China’s Didi Chuxing is trying to give the ride-hailing company a run for its money.
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