China's car-hailing giant Didi Chuxing announced on August 1 that it will acquire Uber China in a deal that will value the combined company at USD 35 billion.
Investors in Uber China, an entity owned by San Francisco-based Uber, Baidu Inc. and others, will receive a 20% stake in the combined company. Uber will continue to operate its own app in China for now. Didi is making a USD 1 billion investment in Uber at a USD 68 billion valuation, people familiar with the matter said.
The Chinese government passed a new rule last week that legalized ride-hailing services, paving the way for further expansion of these businesses.
By shedding its massive losses in China, Uber will help clear the path for an eventual initial public offering.
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