Geely Said to Weigh Hong Kong IPO for Ride-Hailing Firm Cao Cao

Bloomberg News, Bloomberg News

(Bloomberg) -- Chinese carmaker Zhejiang Geely Holding Group is considering an initial public offering in Hong Kong for its ride-hailing firm Cao Cao Mobility, according to people familiar with the matter.

A potential share sale in the Asian financial hub could take place as early as next year, the people said, asking not to be identified because the matter is private. An IPO could raise several hundred million dollars to further expand across the world’s second-largest economy, the people said. The company is also weighing a pre-IPO funding round, they said.

Considerations are preliminary and Geely could decide to delay or to not proceed with the planned listing and funding round, the people said. A representative for Geely declined to comment.

Cao Cao offers ride-hailing via its own fleet of vehicles and taxis, as well as services including concierge and car rental, according to Geely’s website. It claims to be the first low-carbon mobility brand in China to use new energy vehicles. It’s available in more than 62 cities, including Hangzhou, Beijing, Shanghai, Guangzhou and Shenzhen. It competes with bigger rivals T3 Mobility and industry giant Didi Global Inc.

The company was established in 2015, and raised 1 billion yuan ($147 million) three years later in a series A funding round that valued it at more than 10 billion yuan, its website shows. It raised another 3.8 billion yuan last year in a series B round from investors including Suzhou Xiangcheng Financial Holding Group.

Cao Cao is a warrior character taken from the classic Chinese literature “The Romance of Three Kingdoms”. The famous Chinese proverb “Shuo Cao Cao, Cao Cao dao” was derived from the same novel, meaning “One speaks of Cao Cao, he will appear right away.”

Geely’s Hong Kong-listed carmaker Geely Automobile Holdings Ltd. said this week that it’s seeking to boost sales of electric vehicles as well as bolster exports to help recover from disappointing first-half earnings that were pummeled by Covid-19 lockdowns and supply chain snarls.