Chinese ride hailing service Didi Chuxing has acquired all assets of Uber China–including its brand, business operations and data–for operation within mainland China. Both the companies have officially announced the deal after it was reported yesterday.
In exchange for the Uber China assets, Uber will receive 5.89% of the combined company with preferred equity interest which is equal to a 17.7% economic interest in Didi Chuxing. Baidu and other Chinese shareholders will receive a 2.3% economic interest in Didi Chuxing. Under the agreement, Didi Chuxing will also obtain a minority equity interest in Uber. Cheng Wei, founder and chairman of Didi Chuxing, will join the board of Uber. Travis Kalanick, founder of Uber, will join the board of Didi Chuxing.
As a result of this deal, Didi Chuxing becomes the only company with common investment from Tencent, Alibaba and Baidu. Under the agreement, Uber China will maintain independent branding and business operations. Didi Chuxing will integrate the managerial and technological experience and expertise of the two teams, to meet China’sever richer transportation demands with more value-added solutions. It will continue to work with global partners in connecting local resources to create the best possible cross-border ridesharing experience for their users.
Cheng Wei, founder and CEO of Didi Chuxing, said,
Didi Chuxing and Uber have learned a great deal from each other over the past two years in burgeoning new economy. As a technology leader deeply rooted in China, Didi Chuxing is constantly pushing the frontier of innovation to redefine the future of human mobility. This agreement with Uber will set the mobile transportation industry on a healthier, more sustainable path of growth at a higher level. Didi Chuxing commits all our energy to work with regulators, users and partners to meet the transportation, environmental and employment challenges of our cities.
Travis Kalanick, CEO and Co-Founder, Uber said in a blog post,
Uber China—in just two years—has exceeded even my wildest dreams. We’ve grown super fast and are now doing more than 150 million trips a month. This is no small feat given that most U.S technology companies struggle to crack the code there. That’s why I’m so proud of what our amazing China team has accomplished.