Apple-backed Didi Chuxing will acquire UberChina

China’s Didi Chuxing, in which Apple has invested, has announced a strategic agreement with Uber under which Didi Chuxing will acquire all assets of UberChina--including its brand,business operations and data--for operation within mainland China.  

In exchange for the UberChina assets, Uber will receive 5.89% of the combined company with preferred equity interest that’s equal to a 17.7% economic interest in Didi Chuxing. In addition, Baidu and other Chinese shareholders will receive a 2.3% economic interest in Didi Chuxing. 

Under the agreement, Didi Chuxing will also obtain a minority equity interest in Uber.Cheng Wei, founder and chairman of Didi Chuxing, will join the board of Uber.Travis Kalanick, founder of Uber, will join the board of Didi Chuxing. Additional terms weren’t disclosed. However, with the transaction, Didi Chuxing becomes the only company with common investment from Tencent,  Alibaba and Baidu.

Didi Chuxing announced on May 13 that Apple has invested $1 billion in the Chinese car hailing company. Didi claims the investment will see Apple involved in both its technology and product strategies, but further details about this have been scarce.

For Apple, the investment in Didi highlights the strategic importance of China and the services segment for Apple’s future strategy, according to Jack Kent, director, Operators & Mobile Media at IHS Technology. The past quarter’s results show that Apple’s iPhone business is slowing and expansion in China had been one of its main growth drivers in recent years