“I have no intention of selling Huimin Travel, and it has not reached a high value.
Didi is indeed booming, but Huimin Travel’s taxi-hailing and ride-hailing businesses have also been steadily improving.”
Although he said this, Zhang Yida began to seriously analyze the pros and cons in his heart.
It is an indisputable fact that it is difficult for Huimin Travel to make a profit.
In this life, Huimin's travel conditions are much better than those in the previous life, such as worshiping motorcycles and yellow cars.
Because there is no evenly matched competitor to compete with Huimin Bicycle, there are no messy things like red envelope cars.
Although some unnecessary marketing expenses have been saved, Huimin Bicycle's cycling income has been unable to increase due to the existence of Xiaolan Bicycle and Hello Bicycle.
Because these two companies offer free riding activities from time to time, Huimin Bicycle has no choice but to follow suit.
As for things like price increases, it is estimated that everyone will sit together and talk about it when they cannot bear the loss.
And the merger of two bicycles will monopolize the market.
Zhang Yida believed that Didi and Ah Li would rather lose money than sell to him.
The aggregation of taxi-hailing and ride-hailing services has developed rapidly based on Huimin Travel, a platform with tens of millions of active users.
After spending nearly 100 million US dollars in subsidies for drivers and passengers, the business has ushered in a new round of explosion.
However, due to the existence of Didi, the imagination space of these two businesses is very limited.
Zhang Yida remembered the data released by Didi in his previous life in 2017, which showed that the profit from ride-hailing was 800 million yuan.
The size of Didi Hitchhiker is currently seven or eight times that of Huimin Hitchhiker.
Even if Huimin Hitchhiking can reach half the size of Didi in the future, the profit will be only 300-400 million yuan.
Aggregated taxi-hailing cannot take away too much of Didi’s market share. Because other small and medium-sized taxi-hailing software cannot reach 20% of the market share. The other shares are all shared by Didi, and its market share is still increasing rapidly.
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In the previous life, in 2018, the Ministry of Transportation also issued a document to investigate Didi on the grounds of suspected monopoly.
Zhang Yida is not sure whether Huimin Travel will be fully profitable in the future.
Without considering bicycle depreciation, it is definitely no problem to achieve revenue balance.
But regardless of the depreciation of bicycles, in one or two years, 10 million bicycles will break down and 5 million will be broken down. Will we still invest in new bicycles?
If we don’t launch new bicycles, revenue will decline and valuation will fall.
When launching new bicycles, you need to consider the source of funds.
Before Huimin Travel had the ability to self-generate, its funding sources were equity financing and debt financing.
In another year or two, it will be difficult for Huimin Travel to raise funds.
Because both Uber and Didi are useless, who would dare to invest?
Debt financing is also difficult, because a bunch of old bicycles and equity in companies with no imagination are worthless.
If Huimin Travel is sold, it will also have an impact on several of its other companies.
The biggest impact is on Ruimin Financial Management. There is no guarantee that Didi will still be willing to renew the deposit financial management cooperation.
The second is Ruixiang’s magic treasure payment, which lacks a payment scene.
Other companies, such as Pinduoduo, Yimindai, etc., are fine, but they just lack an advertising channel.
"Yida, you might as well listen to Didi's quotation first."
Seeing Xuecunhe's confident look, Zhang Yida was also a little curious as to what kind of price Didi gave.
"$6 billion!"
After reporting the figures, Xue Cunhe smiled and said: "Didi is very sincere. This US$6 billion includes US$1 billion in debt obligations.
In other words, there is US$5 billion that can be given to Huimin Travel’s existing shareholders.
If you hold 30.57% of the shares in Yida, you can get a share of US$1.5 billion.
Of course, it is impossible to pay in full cash.
You can choose to convert all US$1.5 billion into Didi shares, or you can choose to take half in cash and half in Didi shares."
“You want to buy Huimin Travel at this price, are you not dreaming?
Huimin Travel was valued at US$6 billion in Series C financing last April.
The acquisition fee of US$5 billion cannot be explained to the shareholders who joined the Series C round.
Mr. Xue, you are also an old investor. According to this quotation, the ratchet clause of Series C financing will be triggered.
The management and I need to compensate Series C investors with equity."
Xue Cunhe reassured: "Yida, it's nothing if the ratchet clause is triggered, it's just a few shares.
At that time, our pre-C round shareholders will negotiate and it will be even. It will not cause you and the founding team to suffer.
But then again, you have to seize such a good opportunity to cash out."
Zhang Yida thinks Xue Cunhe is too concerned about this matter!
But when I think about it carefully, I think it’s normal.
SoftBank has just acquired a large number of shares in Huimin Travel at a low price. As soon as you enter and exit, buy low and sell high, you can make a lot of money.
In addition, selling Huimin Travel to Didi Travel can greatly strengthen the latter's strength.
SoftBank also has a large stake in Didi, and they will also benefit from it.
For SoftBank, this is a plan to kill two birds with one stone.
"Mr. Xue, see if this can be done."
Zhang Yida began to talk about his plan, "SoftBank holds shares in Ali, Didi, and Huimin Travel, and has significant influence on the three companies.
For Didi, what they fear most is that we will invade the online ride-hailing industry and shake its foundation.
As long as they agree to sell Xiaolan Bicycle to us, we can ensure that the well is not in trouble.
And Ahri is of little use holding a small Hellobike. You can do their job and let them sell Hellobikes to us.
In exchange, we allow Huimin Travel to access Paypay and Sesame Credit."
“You want to create a monopoly on shared bikes?”
Then Xue Cunhe reacted again and shook his head repeatedly: "Yida, please don't make things difficult for me, an old man. I don't have that much energy with my old arms and legs."
He glanced at Zhang Yida and said with a smile: "You want Didi to raise the price, right? That's no problem, SoftBank can take charge of the negotiation.
But don’t have too high expectations. After all, others are not fools.
For a multi-billion-dollar large-scale merger and acquisition, it would be a good thing if it doesn’t give you a broken valuation.”
"And even fractured bones!"
Zhang Yida smiled, old people are quite fashionable.
“It is Didi that needs us, not us that needs it. If Didi does not acquire Huimin Travel, its ecology will be incomplete and there will always be a missing link.
Let’s take the simplest example. Didi only has more than 30 million monthly active users. If they integrate Huimin Travel.
This number could double to nearly 100 million people. What does this mean for them?
It means a merger and acquisition, and the whole company will turn around..."
Zhang Yida's rhetoric was very similar to how Xue Cunhe persuaded Chen Wei.
Anyone with a discerning eye can see that the traffic portal of shared bicycles is very important to Didi.
Without it in hand, Chen Wei might not be able to sleep.
Xue Cunhe was silent. They are all clever little people and are not easy to fool.
"Yida, tell me what is your lowest price?"
"$10 billion!"
Xue Cunhe has a headache. Being a broker is really not easy! There are bosses on both sides, so it is difficult to be a middleman.
"Let's not talk about whether Didi accepts it. If we really follow this offer, most of it may have to be through equity acquisition.
For example, let’s say the ratio of equity to cash is 73 to 82. Can you accept this plan?”
Zhang Yida thought for a while and asked: "What is Didi's current valuation?"
Xue Cunhe also told the truth: "After completing the new round of financing led by SoftBank, the valuation will rise to US$50 billion.
If Huimin Travel is acquired again, it will be close to US$60 billion."
The bubbles were blowing so fast and so big that Rui Xiang was lagging far behind Di Di.
But Zhang Yida really doesn’t want Didi’s equity.
This year should be the peak of Didi’s valuation.
Next year, a passenger on Didi's ride-hailing service will be killed, sparking heated debate across the country, and Didi will be forced to shut down its ride-hailing business.
As soon as Didi showed signs of decline, players from all walks of life came on stage.
Magnesium Tuan, Amap, and Qiandu Map entered the game, plus other small and medium-sized taxi-hailing software, and DiDi's glory suddenly disappeared.
Didi's valuation once reached 80 billion US dollars, and then fell back to more than 50 billion US dollars.
In the meantime, several rounds of financing occurred.
If we invest now at a valuation of more than 50 billion US dollars, we might even lose money.
Anyway, in his previous life, Zhang Yida saw Didi shareholders changing hands of Didi’s old shares at a valuation of US$40 billion.
"$6 billion, all-cash acquisition."
Zhang Yida decided that he still couldn't take Didi's shares, even if he could sell the company at a cheaper price.
“All cash?”
Xue Cunhe was surprised, smiled and shook his head, "This is unrealistic and illogical!
Even if Didi completes this round of financing, it will only have just over US$13 billion in cash on its books.
If nearly half of the funds are used to acquire Huimin Travel, what will happen to its own business?"
"Wouldn't it be nice to raise another round? Or wouldn't it be nice to raise a larger round of financing, 10 billion U.S. dollars? It sounds more domineering than raising billions of dollars.
Moreover, it can also create a global single private equity financing record in the Internet field. This is all living advertising."
Xue Cunhe shook his head and laughed. He wanted to say something: Do you have any misunderstanding about 10 billion US dollars?
Internet companies that can raise hundreds of millions of dollars before going public are considered to be well-known in the industry.
Raising billions of dollars is rare in the world.
As for more than 10 billion US dollars, Xue Cunhe has never seen it in his career.
"Yida, I can only say that we will try our best to talk, but I can't guarantee that it will be successful.
Try to make the purchase price and cash ratio as high as possible!”
Zhang Yida nodded and said: "By the way, I have another condition, that is, after Didi acquires Huimin Bicycle, the cooperation between Ruixiang and Huimin Bicycle cannot be terminated.
Cooperation agreements including Mobao Payment, Mung Bean Credit, Mini Programs, etc. have to be re-signed for a period of five years."
Xue Cunhe smiled, knowing that Zhang Yida was afraid of Ah Li behind Didi.
He nodded, "Okay, I'll add this one too."
Zhang Yida thought of deposit financial management and quickly added another thing.
Deposit financial management and Duruimin financial management are too important. If they are suddenly removed from the shelves, it will cause panic among users, which will be troublesome.
Large-scale withdrawal of funds by users will cause great trouble to Ruimin Financial Management.
If a run occurs, the risk will still be passed on, and Huimin Travel will not be able to survive alone.
Xue Cunhe obviously knew how powerful he was, so he complied with this request.
After all the conditions were negotiated, Zhang Yida said: "Then let's inform the other shareholders and let's have a meeting together."
Then, Huimin Travel held a shareholders’ meeting.
Selling yourself?
When a group of shareholders heard about this meeting topic, they exploded.
Didi has been in the limelight in the past two years and is a super unicorn with a valuation of tens of billions of dollars.
Most people think that selling to Didi is not bad and he is a good buyer.
Some time ago, with the withdrawal of two shareholders of Matrix Partners and Jinshahe Venture Capital, many other shareholders also retreated.
They were also wondering if the Huimin Traveling ship was going to sink?
Because Xu Xiaoming and Shen Beipeng were relatively close to Zhang Yida, they both cast inquiring glances at the conference.
Zhang Yida nodded to them, indicating that there was no problem.
Then Zhang Yida said: "We are still in the negotiation stage, please don't let the news leak out.
The reason why we chose to "merge" with Didi is because one plus one is greater than two.
We are number one in the field of shared bicycles, but we missed the opportunity in the field of online ride-hailing;
Didi is the opposite of us. They are number one in online ride-hailing, but they have missed out on shared bicycles.
If we merge with them, we can also form complementary businesses and create greater value for shareholders and users..."
Zhang Yida explained a little more and then announced the voting.
No one objected, and the resolution to sell oneself was passed unanimously.
After the resolution was passed, the negotiation team began to be formed.
After discussions and consultations, Blackshirt Capital, Penguin, SoftBank and other shareholders sent their respective representatives, together with the management of Huimin Travel, to form a negotiation team.