This merger will mark the end of a protracted competition between the two ride-hailing giants in China
Two Chinese riding hailing giants, Uber China and Didi, are set to merge in a deal valued at US$35 billion, according to sources at Bloomberg. Investors in Uber’s China chapter will stand to receive a 20 per cent stake in the merger.On Didi’s part, it will reportedly invest US$1 billion at a US$68 billion valuation.
For Didi’s part, it will reportedly invest US$1 billion in Uber China at a US$68 billion valuation. Uber China will still use its own app.
This news comes just after Chinese regulators announced that ride-hailing services will be legalised as of November. Bloomberg also reported two weeks ago that investors in China were pushing for a deal with Didi to curb searing losses – Uber has reportedly lost more than US$2 billion in the Chinese market, this is despite the backing of Baidu, who led a round of more than US$1.2 billion last year.
“Uber and Didi Chuxing are investing billions of dollars in China and both companies have yet to turn a profit there. Getting to profitability is the only way to build a sustainable business that can best serve Chinese riders, drivers and cities over the long term,” said Travis Kalanick, chief executive officer of Uber, in a blog post.
More as the story develops
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