The German weekly Der Spiegel reported on Friday that VW would write off the investment after concluding that Gett’s app had failed to gain ground on bigger rivals Uber and Lyft of the United States and China’s Didi Chuxing
Spiegel cited sources saying Volkswagen had already written down the value of its Gett holding to just 16 million euros ($18.3 million). Volkswagen declined to comment.
If true, the news would mark a big comedown for Gett and make it harder for the company to raise capital in the future.
But sources close to Gett told TheMarker that VW’s decision didn’t seem to make sense, noting that as recently as June the German company had participated in an $80 million fundraising round.
In addition, the sources said, the company has switched focus from growth to profitability and expects to show revenues for 2018 of $1 billion. Gett aims to be profitable after discounting for research and development expenses in 2019, and be fully profitable the following year.
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