Cango Inc., a Chinese car sales marketplace and financing aggregator, plans to form a “comprehensive” partnership with ride-hailing company Didi Chuxing to provide automotive financing.
Cango noted the plans in a filing with the Securities and Exchange Commission last week seeking $300 million in an initial public offering on the New York Stock Exchange. Didi Chuxing holds a 14.8% stake in Cango and is reportedly interested in how the online marketplace’s acquisition of lender Shanghai Autohome can deliver value to drivers seeking leases.
“As we continue to grow our platform, broaden service spectrum, and accumulate data insights, we are exploring opportunities to cooperate with our strategic investors,” Cango wrote in the filing. “For example, we plan to form a comprehensive partnership with Didi Chuxing to provide a variety of solutions to its large and rapidly expanding fleet, such as automotive financing, vehicle sourcing, and insurance facilitation.”
Cango took a 50% stake in Autohome in June 2017 and is on track to take full control next quarter. However, the lender’s financing volume is falling and delinquencies are higher than expected, Arun George, an analyst with Global Equity Research, wrote in a published report. The companies did not respond to requests for comment by press time.
Through March, Cango was working with 11 third-party financial institutions, including Jincheng Bank and Jiangnan Rural Commercial Bank. Cango facilitated $900 million of auto originations for its bank partners in the three months ending March 31 — a 7.2% year-over-year increase.
