Chinese search engine major Baidu Inc. is infusing $600 million into web-based car booking services firm, Uber Technologies Inc., for a minority stake, says a Bloomberg report quoting unnamed sources. The funding will boost Uber’s plans to expand to China, one of the fastest-growing markets, globally.
Early this month, Uber had announced a $1.2 billion investment from a group of undisclosed investors. According to report by The Wall Street Journal, New Enterprise Associates (NEA) and Middle East sovereign wealth fund, Qatar Investment Authority, had participated in that round. US-based Valiant Capital Partners and Lone Pine Capital had also co-invested in the round that valued Uber at $40 billion.
Launched in 2009, San Francisco-headquartered Uber is one of the heavily-funded online car hire services in the world. The company enables users to request a ride any time using its iOS and Android apps, as well as from its mobile site m.uber.com. Uber is simply a booking platform, and the cars are not operated by the company.
In July this year, Uber had closed $1.2 billion in funding from institutional investors, mutual funds as well as PE and VC investors at $17 billion pre-money valuation. According to a The Wall Street Journal report then, the investors who participated in that round included Fidelity Investments, Wellington Management, BlackRock Inc, Summit Partners, Kleiner Perkins, Google Ventures and Menlo Ventures.
Previously, Uber had raised over $361.2 million in funding led by Google Ventures, which put in $258 million.
The company started its operations in India in October last year and is already present in 11 cities — Bangalore, Chandigarh, Chennai, Jaipur, New Delhi, Pune, Ahmedabad, Kolkata, Hyderabad and Mumbai. It recently entered Kochi.
Recently, Uber rolled out its ultra cheap variant UberGo in India that offers its customers chauffeur-driven hatchbacks (like Tata Indica Vista, Etios Liva and Maruti Suzuki Swift) for a price that it claims is lower than an auto-rickshaw. The company is also running a vehicle financing programme in partnership with financial services firms and auto manufacturers.
Recently, the Delhi government banned Uber following rape allegations against one of its drivers in the city. The Ministry Of Home Affairs has also advised all states to stop operations of Uber and other online cab booking companies like Ola Cabs and TaxiForSure until they procure licences to operate.