Uber Makes a Deal with Didi Chuxing in China at $35 Billion

Saurabh Singh May 23, 2022
Didi Chuxing
Table of Content

Govt. of China passed a law regarding ride-hailing services by paving the way for further development of these businesses. As a result, Uber Technologies recently announced that it would unite the China business with Didi Chuxing which is China’s ride hailing service. Uber is regarded as one of the most successful startups worldwide. It serves as a role model for many other startups. It has a reach over 16 countries that include 5 continents. On the other hand, Didi Chuxing was earlier known as Didi Kuaidi which was a merger of Didi Dache and Kuaidi Dache.

Let’s decode the deal in detail:

Didi Chuxing and Uber both are cab aggregators and were running business in China independently but as per the sources, they both were yet to make profits in China.

The main investors in Uber China Baidu and San Francisco-based Uber are entitled to get approx 20% of equity in the combined company. The breakup is as following: Uberglobal will get 5.89% with ‘prefered equity interest’ which equals to 17.7% stake in the joint venture. Other local shareholders including Baidu are entitled to receive 2.3% stake in Didi Chuxing.

Travis Kalanick, the CEO of Uber wrote on official Uber newsroom.

“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.”

As far as the top management is concerned, founder of Didi, Cheng Wei, will be on the board of Uber and Travis kalanick would join the board of Didi.

As per a source from Uber, “this deal would be beneficial for both Uber China and Didi because there was a fierce competition going on between both the companies and none was able to churn profits. The competition was so fierce that the startup giant incurred a loss of over $2 billion in just two years in China in order to stay ahead in the business.

President of Didi Jean Liu said that Didi is extremely happy with this collaboration as Uber was its biggest competitor but now together they can create new milestones in the business.

Uber did the same thing as yahoo did back in 2005 when it sold its businesses in China to Alibaba Group Holding Ltd. in $1 billion.

Our Take

Looking at the bigger picture, I must say that Uber has taken the right decisions in past and because of those decisions, Uber is what it is today. In China, The U.S Startup was continuously making losses but now both the startups will reap the benefits. I wish both the startups good luck in their journey and for a long lasting relationship.

Taxi booking apps are one of the most successful ones and if you have an app idea, give us a chance to convert your ideas into reality.

Saurabh Singh
CEO & Director
Prev PostNext Post
Read more blogs
blockchain platform to fight against coronavirus

Is Blockchain the Answer to Fighting Coronavirus Outbreak?

The victim-count of Coronavirus has increased to 28,276 while taking 565 lives already.  With the virus epidemic being on the verge of becoming pandemic, there is a cloud of concern hovering over not just the affected nations but also the rest of the entire world.  The grim picture of Coronavirus is not just of the…

Tripti Rai
Modern Android App Architecture with Dropbox Store

Modern Android App Architecture with Dropbox Store and JetPack

A few days ago, Dropbox acquired an open-source Store library. The aim behind taking the ownership was to modify it to make it more suitable to the prevailing Android developer ecosystem.  Now, Store also includes Google JetPack collection of libraries which poses as a solution for creating current-day Android apps. Google JetPack makes it possible…

Shivani Dubey
Google Acquires AppSheet, a No-Code Mobile App Development Platform

Google Acquires Appsheet, a No-code Mobile App Development Platform

Google recently announced that they have acquired AppSheet, a Seattle based no-code mobile app development platform. The terms of the acquisition have not been disclosed yet, but it has been revealed that AppSheet will continue to serve its existing customers.  AppSheet was founded back in 2014 by Praveen Seshadri and Brian Sabino to help businesspeople…

Bhupinder Kour
Mobile App Consulting Company on Clutch Most trusted Mobile App Consulting Company on Clutch
appinventiv India

B-25, Sector 58,
Noida- 201301,
Delhi - NCR, India

appinventiv USA

79, Madison Ave
Manhattan, NY 10001,

appinventiv Australia

Appinventiv Australia,
East Brisbane
QLD 4169, Australia

appinventiv London UK

3rd Floor, 86-90
Paul Street EC2A 4NE
London, UK

appinventiv UAE

Tiger Al Yarmook Building,
13th floor B-block
Al Nahda St - Sharjah

appinventiv Canada

Suite 3810, Bankers Hall West,
888 - 3rd Street Sw
Calgary Alberta