Uber and Land Wars in Asia
You fell victim to one of the classic blunders! The most famous of which is “Never get involved in a land war in Asia,” but only slightly less well-known is this: “Never go against a Sicilian when death is on the line!” - Vizzini in The Princess Bride (1987)
Uber is selling it’s China business to Didi Chuxing, the ride sharing leader in China, after investing over $2B in a subsidy war over the last three years to gain marketshare. Pending regulatory approval, Didi will be acquiring Uber China in exchange for 20% equity in Didi (with Didi now valued at $35B). Before the acquisition, Uber China was valued at $7B, and Didi was valued at $28B. Note that Uber China was a standalone business and it’s investors included Uber and Baidu among others, so Uber specifically will receive 17.7% of Didi equity. In addition, Travis Kalanick of Uber and Cheng Wei of Didi will sit on each others boards.
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