Uber to merge China business with rival Didi Chuxing, reports say

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Image caption US-based Uber launched in China in 2014

Ride-hailing firm Uber has reportedly agreed to merge its business in China with much bigger rival Didi Chuxing.

According to Bloomberg, the $35bn (£26bn) deal will give Uber China, which is owned by US-based Uber, Chinese internet giant Baidu and others, a 20% stake in the company.

Uber China launched in 2014 but so far has failed to make any profit.

The two sides have for years been fierce competitors but Didi Chuxing has remained the dominant market leader.

As of May, Didi Chuxing said it provided more than than 11 million rides a day and claims to have 87% of the market share in China.

The company is backed by Chinese internet giants Tencent and Alibaba, and has also invested in Uber"s rival US ride-sharing service Lyft.

Big losses

Uber has been struggling to break into the Chinese market despite having Chinese search engine Baidu as an investor.

In February, the company admitted it was losing more than $1bn a year in China, spending huge sums to subsidise discounted rides.

The reported deal with Didi Chuxing comes just days after China agreed to provide a legal framework for ride-hailing apps.

Both Uber and Didi have welcomed the decision, having previously operated in a legal grey area in the country.

While the ride-hailing apps are widely popular, they have undermined business for normal taxis and have been met with protests by cab drivers.

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Uber to merge China business with rival Didi Chuxing, reports say
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