Uber and Didi were caught up in a major price war in China, something that was hurting both companies as they fought for control of a major territory. However, Didi gave $1 billion to Uber and Uber acquired a 17.7% stake in Didi in an agreement that resulted in Uber leaving China. That was likely a good idea considering that Uber lost over $1.2 billion in the first half of 2016.
But the deal has attracted regulatory scrutiny in the country where the companies were having said price war: China.
Chinese regulators have twice met with Didi Chuxing management following the announced deal, as the regulators look to get a deeper understanding of the market. And while the deal leaves Didi with roughly 90% of the ride-hailing market to itself, according to Bloomberg, the “odds are slim” regulators will call off the deal.
The companies could be hit with several fines or punishments if they fail to file the correct paperwork with China, but by most accounts, the deal doesn’t seem like it won’t be approved.
