Uber CEO Travis Kalanick announced via a blog post that Uber China - a subsidiary of the taxi-hailing app - will merge with its biggest competitor in the region - Didi Chuxing - in a whopping $35 billion deal.
The blog post has recently been doing the rounds on Chinese social media, with the deal effectively signalling the end of a hard-fought market share battle in China in which both companies have invested huge amounts of money without really getting anywhere.
According to Business Insider, the terms of the deal state that Didi will invest $1 billion in Uber Global at a $68 billion valuation, leaving Uber China's investors with a 20 per cent ownership of the new company, set to be valued at $35 billion.
In the blog post, Kalanick says: "As an entrepreneur, I've learned that being successful is about listening to your head as well as following your heart. 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.
"I have no doubt that Uber China and Didi Chuxing will be stronger together. That's why I'm so excited about our future, both in China - a country which has been incredibly open to innovation in our industry - and the rest of the world, where ridesharing is increasingly becoming a credible alternative to car ownership."
Interestingly, Apple recently invested $1 billion in Didi Chuxing for "strategic reasons" and in order to "learn more about certain segments of the China market."
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