SHANGHAI, Aug. 31 /PRNewswire-Asia/ -- eHi Car Rental (http://www.1hai.cn , "eHi"), a Shanghai-based leading car rental company in China, is pleased to announce that it has signed a definitive investment agreement valued at US$70 million today with a consortium including Goldman Sachs, as the lead investor, and all of eHi's existing shareholders: Qiming Venture Partners, CDH Ventures, Ignition Capital, JAFCO Asia and New Access Capital. The transaction is expected to close soon.
Mr. Ray Zhang, the founder, Chairman and CEO of eHi, said: "This is by far the largest equity investment in the Chinese car rental business. In conjunction with the previous two investments we received from other leading investors, this transaction connotes recognition of our leading position in the industry. I'd like to take this opportunity to express my appreciation to all of our staff. Without their dedication and contribution, our business could not have achieved rapid growth within just five years. We are excited to have Goldman Sachs, the global renowned investment powerhouse, to become our shareholder, and we believe that its rich expertise in this business and unmatched financing capability will add significant value to our future growth. After this closing, we will further expand our fleet and geographical coverage, provide more value-added services and pioneer a greener life style through car sharing for our customers, promote fleet outsourcing to more corporate clients, and maintain our leading position in China's car rental market."
eHi has the broadest geographical coverage and vehicle model selection, as well as the most comprehensive services in China. eHi operates over 120 self-drive service locations in 34 cities with over half a million customers. It also provides chauffeured service in over 70 cities and serves nearly half of the Fortune Global 500 companies in China. Its 4,000 plus vehicle fleet includes a full variety of models from mini-size car to 53-seat bus. eHi's services include customer-oriented self-drive service, short-term chauffeured service, and long-term fleet management for corporate clients. eHi will continue to provide convenient, affordable and reliable self-drive car rental service to individual customers, and premium quality one-stop car services to corporate clients. Featured by an industry-leading online booking platform and proprietary ERP system, a proven business model that has been adapted for the Chinese market, and strong growth momentum, eHi was awarded "Best Business Model in 21st Century" by the 21st Century Business Herald newspaper in 2009, the "Red Herring Global 100" distinction in 2009, "Future Star in 21st Century" by China Entrepreneur magazine in 2010, and the "Top 10 Green Companies" by Commerce Weekly in 2010.
eHi is the first car rental company in China that launched a car-sharing service in Beijing and Shanghai in 2009. It was similar to the Cambridge, Mass.-based Zipcar Inc., which is now preparing for an IPO in the U.S. "eHi's mission is to help China avoid taking such a disastrous route... We promote this lifestyle and hope to raise the consciousness of China's consumers," according to Ray Zhang.
Traffic jams in the city are going to become a predicament day after day for the general public and has amplified the troubles that the public faces during daily routine. Statistics show that the number of private cars in Beijing has been added at an average rate of 1,900 cars per day in the first six months of the year, and the city already has some of the worst traffic in the world. The increasing number of vehicles also add to the pollution problem and parking issues, which is forcing people to find ways to ameliorate the situation. Car-sharing is a revolution in personal transportation. It is also an energy-saving idea that reduces congestion and pollution.
As China's consumers continue to purchase cars in increasing numbers, the problem is becoming more severe. Obviously, car rentals are able to improve China's traffic situation and relieve parking issues, as well as pollution problems and oil demand. "The largest car rental industry will be in China, and therefore the largest car rental company will be in China in the future," predicted Ray Zhang.
Source: eHi Car Service Co. Ltd.
