China’s biggest two ride sharing apps Didi Dache and Kuaidi Dache have announced plans to merge, creating a single entity that would control about 99% of the taxi app market in China.
Hangzhou-based Kuaidi and Beijing-based Didi will continue to operate separately and the respective CEOs will co-chair the new company.
Kuaidi has a 56.5% share of the market, while Didi accounts for 43.3% according to data released in December and analysts believe the new combined company’s market value would be about US$6 billion.
The new business will be formally announced after the Lunar New Year holidays.
The two companies have been fierce rivals, locked in an intense price war and together have raised over $1 billion from investors in recent months.
Alibaba, a major backer of Kuaidi, said it was "supportive of this merger as it will promote the healthy development of the taxi-app and expand city travel options for users."
Didi has been bankrolled by Internet giants Tencent Holdings Ltd.
The new company will create a major barrier for Uber’s protracted entry into the China market.
Uber itself recently received significant funding from Chinese internet search giant Baidu.
