China's Commerce Ministry Probes Didi-Uber Merger for Third Time in a Month
Yicai Global
/SOURCE : Yicai
China's Commerce Ministry Probes Didi-Uber Merger for Third Time in a Month

(Yicai Global) Sept. 5 -- China's commerce ministry is seeking clarification from Didi Chuxing for a rare third time in a month over its proposed merger with the China business of Uber Technologies Inc. after allegations the deal has not been declared in line with the law.

The ministry's Anti-Monopoly Bureau has already spoken twice with Didi Chuxing seeking details on the deal, relevant documents and materials and an explanation why the company failed to declare it, spokesman Mr. Shen Danyang said at a press conference in Beijing on Sept. 2. He added that to safeguard fair competition the ministry would investigate the case further.

Didi Chuxing's owner, Beijing-based Beijing Xiaoju Technology Co., and Uber, two car-hailing giants previously locked in a battle for market share in China that cost them billions, said on Aug. 1 that Uber had agreed to Didi acquiring its brand, business and assets in the country. The combined business will have a market share of just over 93 percent.

Under the agreement, Didi's founder and Chairman Cheng Wei will join Uber's board. Uber CEO Travis Kalanick will take a seat on Didi's in return. Both parties will become minority shareholders in each other. Since the merger was announced, the commerce ministry also sought clarification on Aug. 2 and 17.

In the first quarter, Didi had an 85.3 percent market share followed by Uber with 7.8 percent and Ucar Inc. with 3.3 percent.

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