Next up, gobbling up Lyft. Looks like they really want to be the monopoly at IPO time. At this rate, they'll probably IPO at more than $100 billion. Sigh, should've interviewed with them last year, haha
Uber to Sell China Business to Rival Didi After Losing Billions
11–20 of 194 posts
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#12This is pure monopoly play - I hope Lyft continues to compete and do not merge ... I hate to be in world where no taxi service exists and I am at the mercy of random surge pricing...
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#13Looks like it's a case of two rivals trying to outspend each other and one has been outspent.
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#14"Didi is making a $1 billion investment in Uber at a $68 billion valuation, people familiar with the matter said."
So that's where Apple's $1 billion in Didi[1] just went!
[1] http://www.reuters.com/article/us-apple-china-idUSKCN0Y404W
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#15Seems like a risky move. My understanding is that China doesn't have the same level of minority shareholder protections as Delaware. I suppose it's better than bleeding for the next 10 years and ultimately losing the market, though.
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#16I can't tell if this is a good deal for Uber investors or not. As I understand it, Uber will own a 20% share in the combined company. The combined company is valued at $35 billion, so Uber's share of the value will be $7 billion (actually less, since they also need to share it with Baidu which invested directly into Uber China too). $7 billion doesn't sound too bad as an exit. However, if Uber's China business is wor…
A general approximation in business is that the non-US market is 5-8x the US market. So if the world market is only 9x the China market, I'd consider that a very big deal.
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#17Back in 2014, Didi and Kuaidi, the other big ride-hailing service in China, had a price war. This forced 20 smaller ride-hailing companies out of business. In 2015, Didi and Kuaidi merged.[1] They managed to escape antitrust review by claiming their revenue was below the $65 million threshold for antitrust reporting in China. With their price war, they were both losing money, so the deal was not subjected to antitrust review by the Ministry of Commerce. Unclear if the Uber deal will get through the same loophole. Anyway, Uber exits from China, with a minor stake in Kuaidi. Now Kuaidi can jack up prices.
[1] http://www.americanbar.org/content/dam/aba/publishing/antitr...
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#18Uber finally threw up the white flag in its fight against Didi in China. I wonder how big of a dent this puts in Uber's sheen of invincibility in other markets. Will investors be braver backing other regional competitors like Ola in India and Lyft in the US?
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#19Merge is such a cute word. "Uber lost China and had to sell to Didi" is more like it
Or Uber invested $2bn and walked out with $7bn. Not a bad deal. Plus the value of the combined entity will skyrocket.
Re: Uber to Sell China Business to Rival Didi After Losing Billions
#20If you can't beat 'em, join 'em. I think uber's playbook of encouraging local activism to overcome govt and incumbent resistant wouldn't work there. Converting Didi into a partner is a big win for them.