Uber’s Chinese operations will merge with Chinese smart cab service Didi Chuxing, it has been reported.
The deal will result in a company worth US$35-billion and also sees Uber China investors get 20% of Didi, Bloomberg claimed. However, Uber China will continue to operate as its own separate business for now.
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Didi will also invest US$1-billion in Uber China, the publication reports, citing “people familiar with the matter”.
“As an entrepreneur, I’ve learned that being successful is about listening to your head as well as following your heart,” said Travis Kalanick, CEO of Uber, in a blog post obtained by Bloomberg.
“I have no doubt that Uber China and Didi Chuxing will be stronger together.”
It wouldn’t be the first significant deal with a Western company for Didi though, having received a US$1-billion investment from Apple earlier this year. Didi also packs financial backing from Tencent and Alibaba.
But Uber China and Didi have been embroiled in a war of sorts for control of the key market. In fact, Kalanick said that the firms were ploughing “billions of dollars in China, and both companies have yet to turn a profit”. Still, Didi is the dominant smart cab service in China, giving it the upper hand.