China’s economy may be slowing down, but the country has tons of cash that’s finding its way out of the country. The latest to get a slice of these funds is the online taxi-hailing service Uber.
Chinese fund manger Hillhouse Capital is reportedly leading an investment that could hit around $1 billion in Uber, according to the Wall Street Journal (paywall), citing people familiar with the matter.
The deal involves buying bonds convertible into shares at a discount over Uber’s IPO price, WSJ said. It signals Uber’s plan for an IPO because returns on the bonds will rise as long as the company has not gone public yet.
Hillhouse’s involvement blends perfectly with Uber’s business strategy as it counts China as, according to WSJ, its “top priority for growth.”
China has an estimated $20 trillion in funds earning less attractive rates in its banks and just waiting to be deployed for investments overseas, according to HKEx CEO Charles Li.
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