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Didi Chuxing confirms it is buying Uber’s business in China

ICE Graveyard 1/08/2016 Jon Russell

China’s Didi Chuxing has confirmed that it has agreed to buy Uber China in a deal that had been heavily speculated earlier today.

Didi said in an announcement that Uber will be given a 5.89 percent stake in the newly merged entity, with preferential equity that is equal to a 17.7 percent economic interest in Didi Chuxing. It explained that existing Uber China investors, which include China’s dominant search firm Baidu, will get 2.3 percent of the new business.

Bloomberg first broke news of the deal, which it reported will include Didi making a $1 billion investment in Uber’s global business. Didi, which claims 15 million drivers and 300 million users in China, simply said it will “obtain a minority equity interest in Uber”.

There’s also some people moving around, too. The deal will see Cheng Wei, founder and chairman of Didi Chuxing, join Uber’s board, with Uber CEO Travis Kalanick joining Didi’s board in return.

Other items to note from the deal include: Uber will maintain its branding, app and business operations, but Didi will “integrate the managerial and technological experience and expertise of the two teams.”

Didi is an investor in Lyft (U.S.), Ola (India) and Grab (Southeast Asia) which also rival Uber worldwide, but the Chinese company said it will “continue to work with global partners” following this deal with Uber.

Now, some of the money quotes from the announcement.

Didi CEO Cheng:

Didi Chuxing and Uber have learned a great deal from each other over the past two years in China’s 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.More to follow

Didi President Jean Liu:

Over 15 million drivers and 300 million registered users have joined DiDi’s open, sharing-based ecosystem that connects people, cars and lifestyles. With the addition of the strong talents and experience of the Uber China team, Didi Chuxing will be even better-positioned to serve the Chinese people. Didi Chuxing will also continue to expand its international strategy. We look forward to working with our partners at home and abroad to create more value for drivers, passengers and communities.

More to follow

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