Taxi app rival Didi Chuxing to buy Uber's China business

The total valuation of the combined ride-hailing company is $35 billion.

Ride-hailing service Uber Technologies Inc would merge its China business with its rival Didi Chuxing, valuing the combined company at US$35bil (RM140.72bil), Bloomberg reported.

Bloomberg cited its sources and said investors in Uber's local China operations would receive a 20% stake in the combined company.

People who are familiar to the matter said Didi is making a $1 billion investment in Uber at a $68 billion valuation. Both Uber and Didi could not be immediately reached for comments regarding this.

Bloomberg reported that Travis Kalanick, chief executive officer of Uber, wrote in a blog post: "As an entrepreneur, I've learned that being successful is about listening to your head as well as following your heart. Uber and Didi Chuxing are investing billions of dollars in China and both companies have yet to turn a profit there. Getting to profitability is the only way to build a sustainable business that can best serve Chinese riders, drivers and cities over the long term."

The deal comes after the China government passed a new nationwide rule last week to officially legalize all the ride-hailing services.