Uber and Didi Call a Truce In China With a $35 Billion Deal (recode.net)

Kara Swisher, reporting for Recode: Uber, which has been spending hugely in China over the last two years, has folded, striking a deal in which it will merge its Chinese operations with its main rival there, Didi Chuxing. Under terms of the deal, Uber China, the ride-hailing company's Chinese subsidiary, will be part of a larger Didi company valued at $35 billion. Uber gets a 20 percent stake in that -- Didi's previous valuation was $28 billion. That's a $7 billion value for upward of $2 billion that Uber has frittered away, um, spent there. In turn, Didi will invest in Uber at a valuation of almost $70 billion. That was about the value of Uber's last round. Now, everyone owns everyone everywhere.

Comments

Uber not so great as a whole

[Anonymous Coward]

For everything that Uber is good for a rider. It's bad for the industry as a whole. It's driven down rates, but at the same time ignored regulations, driver pay, and uniform service. When you basically have a short and quick application, no significant back ground check because myself was approved to drive even before being approved by Checkr the company doing the background check. This sends up red flags in so many ways, and now Uber is raising the percentage they keep from rates all the while reducing rates. The question then becomes ,what kind of people is Uber attracting to drive for them? Like myself I am looking for some extra money but frankly I lasted a couple days with Uber and realized the benefits apply only to riders with Uber. Most drivers can't seem to even make minimum wage much of the time. We all complain about low wages until those low wages benefit us financially. I can't tell you how many Uber forum people said they hate being a Uber driver for lack of money. But will gladly use the service, even knowing how poorly drivers are paid.

Re:Frittered Away?

[whoever57]

If they managed to get a stake worth $7 billion from spending $2 billion, that $2 billion is arguably well spent, even if the actually places the money went look silly.

The problem is that the $2B spent is cold, hard cash that came from investors, while the $7B valuation is just an estimate, based on what a few people think. It may prove to be ephemeral.