Didi and Uber set to merge in China

The bitter battle of the taxi apps seems to be over - at least for now - with news today that Didi Chuxing is to merge with Uber China.

According to media reports, Uber has thrown in the towel in its costly competitive drive against Didi and agreed they will unite as one. According to Bloomberg Travis Kalanick, chief executive officer of Uber, wrote a blog post saying '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.'

Under the terms of the deal, set to be officially announced in coming days, Didi will acquire all of Uber China’s operations and investors and Uber China will get a 20 percent stake in Didi. It seems they will continue to operate as two brands for now, but watch this space for updates.

It follows a long overdue ruling by the Chinese government to legalise ride-hailing services – yes, we know everyone has been using them for years, but now it’s legal – which helps to pave the way for further expansion.

China is already the biggest market for global company Uber, which isn’t hard to believe given how popular it is here. But Didi, which also comes embedded in WeChat Wallet, is the undisputed market leader, taking 80 percent of the market and claiming to provide a mind-boggling 14 million rides a day.