China’s two largest VC-backed taxi-booking apps to merge
Didi Dache and Kuaidi Dache, China's two largest venture capital-backed taxi-booking app start-ups, are planning to merge to create one of the largest companies of its kind in the world.
The financial details have not been disclosed but according to Reuters, the combined entity would be valued at around $6 billion.
Kuaidi's Chuanwei Lu and Didi's Wei Cheng will become co-CEO of the merged company, according to a statement posted on Kuaidi Dache's Weibo microblog. The two companies will still operate independently under separate brands but will combine resources and personnel with a view to building a stronger platform.
The merger aims at global expansion. Lu said in the statement that mobile internet offers the best chance for Chinese transportation services platforms to expand into international markets. More details about the plan are expected to be announced next week.
Kuaidi Dache, backed by Alibaba Group, raised a $600 million round of funding last month led by Softbank and existing backer Tiger Global Management. This followed a $700 million round completed in December for Tencent-backed Didi Dache, which won support from Temasek Holdings, DST Global, GGV Capital and other investors.
As a result of Kuaidi's alliance with Alibaba, passengers can make payments through Alipay. The Didi-Tencent connection allows users to book taxies within instant-messaging app WeChat and pay through Tenpay. According to a consultancy Analysys International, 154 million people in China used a taxi-booking app in the third quarter this year. Didi was estimated to have 55% market share, with Kuaidi claiming almost all the rest.
Didi and Kuaidi primarily digital intermediaries for taxi companies in China, but both expanded into private car booking services later last year, offering rides in Audi and Mercedes-Benz vehicles to high-end customers. It puts them in direct competition with car-sharing platform Uber and local incumbent Yongche.
Baidu, the Beijing-based search engine operator, jumped into the ride-hailing apps market in December by investing in US-based Uber and agreeing to help the firm expand in China.
More on Greater China
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.