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China: Uber’s sale to Didi already hitting a roadblock

 |  August 2, 2016

According to Reuters, Mofcom, China’s commerce ministry, may very well stand in the way of Uber’s Chinese unit and Didi Chuxing’s business combination; as of August 2, the governmental agency has not approved the merger.

Didi Chuxing said that it does not require regulatory approval given the lack of profit among the two companies. In a statement, Didi Chuxing pointed out that the company did not meet an approximately $60 million trigger requirement for an anti-trust process.

Alternatively, the combination of Uber’s China operation with Didi Chuxing’s business will result in a $35 billion ride-hailing behemoth and will raise monopoly concerns.

Didi Chuxing has previously claimed that it holds 87 percent of the market in its home country and Uber China ranks as the second largest company in the space.

“Mofcom has not currently received a merger filing related to the deal between Didi and Uber,” Reuters quoted a ministry spokesman, Shen Danyang, as saying. “All transactors must apply to the ministry in advance. Those that haven’t applied won’t be able to carry out a merger.”

Full Content: Benzinga

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