According to Reuters, China's commerce ministry (Mofcom), could stand in the way of Uber's Chinese unit and Didi Chuxing's business combination; as of Tuesday, the governmental agency has not approved the merger. Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!
Didi Chuxing said that it does not require regulatory approval given the lack of profit among the two companies. In a statement sent to Reuters, Didi Chuxing pointed out that the company did not meet a 400 million yuan (approximately $60 million) trigger requirement for an anti-trust process.
On the other hand, the combination of Uber's China operation with Didi Chuxing's business will result in a $35 billion ride-hailing behemoth and raise monopoly concerns.
Didi Chuxing previously claimed it holds an 87 percent market share 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."
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