Uber China to merge with local rival Didi
RIDE-SHARING giant Uber is to merge its China operations with local rival Didi Chuxing, ending a ferocious battle for market share in the world's second-largest economy.
The deal will give Uber a 20 percent share in the combined firm, Bloomberg News reported, adding it will be valued at US$35 billion.
Both companies have spent billions of dollars on subsidies for drivers and passengers, as well as trading vitriolic accusations, as they fought for dominance in the potentially lucrative market.
As reported, the structure of the agreement leaves Didi Chuxing in unquestioned control.
By "shedding its massive losses" in China, Uber will help clear its way to a future flotation, Bloomberg said.
The reports come days after Chinese authorities announced new rules governing ridesharing, making clear for the first time that they may operate legally in the country.
The new rules also said ridesharing platforms will be forbidden to operate below cost, possibly restricting their scope to offer subsidies.
Didi, which has 90pc of the China ride-hailing market, said last month that it had recently raised $7.3 billion – $1 billion of which came from Apple – in one of the world's largest private equity financing rounds.
As part of the latest deal, Didi Chuxing will invest $1 billion in Uber, valuing the US firm at $68 billion, Bloomberg reported. –
Car-hailing app service Uber's office in Cheung Sha Wan, Kowloon, Hong Kong. According to media reports yesterday, Didi Chuxing is buying its local rival Uber China.The merger deal, which will end bruising competition between the two businesses, is reported to be valued at US$35 billion.