Mobike pedals European unit into management buyout

Mobike’s European business is close to a management buyout, The Telegraph reports. The deal is expected to be valued at USD 100 million (roughly RMB 670 million), and will see Mobike’s Eur

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Mobike pedals European unit into management buyout

Mobike’s European business is close to a management buyout, The Telegraph reports.

The deal is expected to be valued at USD 100 million (roughly RMB 670 million), and will see Mobike’s European management team acquire a majority of the business they oversee from current owner Meituan-Dianping, which acquired Mobike for USD 2.7 billion (or RMB 18 billion) last April.

Paul Zhu, regional general manager of Mobike Europe, is said to be leading the buyout alongside other senior executives. The European leadership also plans to expand Mobike’s offerings in Europe into electric bike- and scooter-sharing services.

Mobike expanded into Europe in June 2017, and was live in 23 European cities across the UK, Germany, France, Spain, Italy, and more, as of October 2018.

Founded in 2015, the company raced ahead in China’s bike-sharing space to become an industry leader, but — like its rival Ofo — has scaled back its international operations in the wake of mounting losses.

Net losses for Mobike’s parent company, Meituan, soared to RMB 8.5 billion (USD 1.26 billion) in 2018, up nearly 200% from the year before, with Mobike contributing RMB 4.5 billion to those losses.

During Meituan’s earnings call last month, company CFO Chen Shaohui said Mobike would restructure its global operations and exit most of its overseas market in order to offset costs. Plans to spin off Mobike’s European unit were first reported in December.