(Yicai Global) Jan. 23 -- Hellobike, one of the bike-sharing operators backed by e-commerce stalwart Alibaba Group Holding Ltd., is reportedly about to close a USD1 billion funding round led by its key investor as it looks to rival industry leaders Ofo and Mobike.
The cycle sharer, officially Shanghai Junzheng Network Technology Co., will raise cash from existing investors, including Ant Financial Services Group, Alibaba's payment arm, and major private investment firm Fosun Group, a source told online news outlet 36Kr. The firm will also bring on board new backers.
China's bicycle-sharing industry is highly competitive. Top players Beijing Bikelock Technology Co. (Ofo), which is backed by Alibaba and the world's largest ride-hailing platform Didi Chuxing Technology Co., and Beijing Mobike Technology Co., with support from internet titan Tencent Holdings Ltd., have blown millions in capital in order to retain their market share.
With the new funds in hand, Hellobike will be snapping at their heels and have a close eye on Ofo, which has locked horns with lead investor Didi and is looking to dilute its shareholding with its own USD1 billion deal with Alibaba. Didi also has plans to set up its own bike-sharing platform and has taken over operational assets at China's former third-biggest cycle sharer Bluegogo, run by Tianjin Luding Technology Co. Latest reports suggest all Ofo shareholders, except Didi, have given the thumbs up for the Alibaba funds.
Hellobike will use the cash to expand its bike-sharing coverage and accelerate its foray into car-sharing and other businesses, one of the sources added. Hellobike is already present in 160 cities, has nearly 100 million users and takes more than 10 million orders a day, according to data disclosed on Jan. 20, which also pegs the company as the country's fastest growing cycle sharer.
Introducing deposit-free rides in cooperation with Alibaba's payment platform Alipay and online credit system Sesame Credit played a significant role in boosting Hellobike's recent growth spurt, industry experts said.