Alibaba, Tencent-backed taxi-booking firms announce merger after Uber zooms in on China

Mainland China’s two largest taxi-booking apps – each backed by respective internet giants Alibaba and Tencent – have today announced a merger in the wake of industry leader Uber's aggressive expansion in the Chinese market.

Alibaba-controlled Kuaidi Dache and Tencent-invested Didi Dache, which together are valued at around US$6 billion, did not disclose details of their respective shares in the merger. But Didi, the larger of the two based on user numbers, reportedly owns a bigger stake of between 52 to 55 per cent.

Didi chief executive Cheng Wei and Kuaidi head Lv Chuanwei will be co-CEOs of the new company.

“The new company after the merger will be an important provider in the global mobile transport sector,” Kuaidi and Didi said in a joint announcement on Valentine’s Day.

Despite the merger, the two companies, erstwhile fierce rivals, will retain their respective brands and independent operations, they said.

The development comes after leading taxi-booking provider Uber, based in the US, secured Baidu’s backing in December to help it expand in China, one of the largest markets for mobile transport services in the world.