China auto rental got funding after IPO suspended

China Auto Rental Holdings Inc, the country's top car-rental provider, announced on Monday it has received $200 million from US-based private equity firm Warburg Pincus LLC.

The amount, the largest equity financing to date in China's car-rental industry, follows an aborted initial public offering in the US earlier this year.

The new investment is higher than what China Auto Rental had expected to raise through the IPO.

According to a statement sent to China Daily, Warburg Pincus will make the equity investment through its affiliate. China Auto Rental had received more than 1 billion yuan ($157 million) in investment and financing from Legend Holdings Ltd in August 2010.

Accordingly to management consultant Roland Berger, China Auto Rental is the only company with network coverage in all the country's provinces and provincial-level. It has a network of nearly 600 service locations covering 66 cities and 52 major airports.

The Warburg Pincus investment will further strengthen China Auto Rental's leadership in China's car-rental industry, said Charles Lu, the company's chairman and chief executive officer.

David Li, managing director of Warburg Pincus, lauded the company's "strong brand, customer and shareholder base and management team."

"Warburg Pincus will bring additional support to China Auto Rental in terms of branding, funding, corporate governance and international resources," he said.

China Auto Rental, which had hoped to become the second Chinese company to list in the US this year, suddenly suspended its IPO in late April, citing concerns it might have to slash its price amid market turbulence.

hewei@chinadaily.com.cn