Uber to merge China business with local rival Didi Chuxing: Report
US-based ride-hailing service Uber Technologies Inc would merge its China business with rival Didi Chuxing, valuing the combined company at $35 billion, according to bloomberg.com, citing people familiar with the matter.
Didi is making a $1 billion investment in Uber at a $68 billion valuation, said the unnamed source.
Investors in Uber China, which is owned by San Francisco-based Uber, Baidu Inc and others, would receive a 20 percent stake in the combined company, said the report.
According to a blog post cited by Bloomberg, Travis Kalanick, chief executive officer of Uber, said: "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."
The authenticity of the blog has not been confirmed by the company.
Both of the companies could not be immediately reached for comment.
Last week, a long-awaited regulation giving legal status to online car-hailing services in China was approved and released by the nation's State Council.
Aimed at regulating the taxi market and car-hailing services in China, the regulation requires car-hailing platforms, such as Didi Chuxing and Uber Technologies, to review the qualifications of drivers and their cars to guarantee safe rides.
In last February, Didi Dache and Kuaidi Dache, the precursors of the Didi Chuxing, jointly announced their strategic merger, becoming one of the largest vendors in the market.
Investors in Uber China, which is owned by San Francisco-based Uber, Baidu Inc and others, would receive a 20 percent stake in the combined company, said the report.
According to a blog post cited by Bloomberg, Travis Kalanick, chief executive officer of Uber, said: "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."
The authenticity of the blog has not been confirmed by the company.
Both of the companies could not be immediately reached for comment.
Last week, a long-awaited regulation giving legal status to online car-hailing services in China was approved and released by the nation's State Council.
Aimed at regulating the taxi market and car-hailing services in China, the regulation requires car-hailing platforms, such as Didi Chuxing and Uber Technologies, to review the qualifications of drivers and their cars to guarantee safe rides.
In last February, Didi Dache and Kuaidi Dache, the precursors of the Didi Chuxing, jointly announced their strategic merger, becoming one of the largest vendors in the market.
