Apple’s Didi investment back in 2016 was hailed by the Cupertino company’s CEO Tim Cook as a “great financial investment.” Sadly, that very much turned out not to be the case.
The investment has instead seen Apple’s billion-dollar stake lose at least 80% of its value, and the company’s sole representative on the Didi board has now quietly resigned …
Apple’s Didi investment
Lyft-backed Didi has been described as China’s Uber – but by 2016 was suffering badly from competition by the actual Uber. Indeed, Uber’s CEO at the time claimed that Didi was losing a billion dollars a year as it struggled to compete.
Didi’s solution to the problem was simple: buy Uber China. To do so, it needed to raise some $4.5B, of which Apple contributed $1B.
At the time, the investment looked solid. The company was valued at $28B before the takeover, and was predicted to rise to $35-36B afterward. Apple was also believed to have additional motives. Cook said at the time that it provided an opportunity for the iPhone maker to better understand the Chinese market, while some suggested that the move was a political one, for Apple to ingratiate itself with the Chinese government.
It was also reported that the deal might open up fresh opportunities for Apple with Uber.
Apple and Uber have some relationships – Uber passengers can pay with Apple Pay, and Uber provides its drivers with iPhones. But Uber has been eager to nail down a deeper partnership with Apple, according to some investors. Now that Uber is aligned with Didi, said managing partner at GGVCapital Hans Tung, opportunities may open up for such a partnership.
Finally, it was suggested that Apple wanted a stake in a ride-share company as part of its Apple Car plans. Many have said that, rather than sell cars to consumers, Apple’s plan was to create self-driving ride-share fleets. This theory was lent additional weight when Didi subsequently created a self-driving car lab in California.
But things did not go well
While things initially looked rosy, with Didi last year filing for an IPO valuing the company at around $100B, it wasn’t long afterward that things started to go badly wrong.
The Chinese government declared that Didi had been illegally collecting user data, fined the company, and ordered Apple to remove the app from the App Store.
Earlier this year, Didi Global Inc. delisted from the New York Stock Exchange, wiping out around $70B of its market value.
Didi’s shares [fell] about 90% since going public, when it was valued around $80 billion. After delisting, the company will likely see its stock traded over the counter on the so-called pink-sheets market, home to penny stocks and other riskier businesses.
Apple resigned its seat on the board
Part of the deal saw a senior Apple exec get a seat on Didi’s board of directors. Among other things, this gave the Cupertino company networking opportunities with some of the top execs in the car industry.
However, Bloomberg noticed that Apple gave up its board seat earlier this month.
An Apple Inc. executive has left the board of Didi Global Inc., as the Chinese ride-hailing company struggles to regain ground it lost during Beijing’s crackdown on the country’s internet sector.
Adrian Perica, Apple’s vice president of corporate development, has resigned from Didi’s board, according to a one-sentence release posted on Didi’s website this month. Didi didn’t respond to requests for comment.
Didi itself offered no explanation, its statement reading in full:
DiDi Global Inc. today announced that Mr. Adrian Perica has resigned from the board.
Apple declined to comment on the development.
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