Chinese ride-hailing platform Didi Chuxing has acquired a ‘controlling stake’ in Brazil’s ride-sharing startup 99. Didi is buying the majority stake in Brazilian startup, in a deal that values 99 at $1 billion, according to Reuters.
The development comes a year later when Didi made an investment of $100 million in 99 last January.
The Chinese company bought out investors such as Riverwood Capital, Monashees Inc, Qualcomm Ventures, Tiger Global Management LLC and SoftBank Group Corp.
“Globalization is a top strategic priority for Didi,” Cheng Wei, founder, and CEO of Didi, said in a statement.
He added that with enhanced investments in AI capabilities and smart transportation solutions, the company will continue to advance the transformation of global transportation and automotive industries through diversified international operations and partnerships.
The acquisition of a controlling share in 99 by the Chinese company has put Uber on the back foot as the San Francisco-based company is the largest shareholder in the ride-hailing space in Brazil.
The new deal will intensify Didi’s global rivalry with Uber, especially in Latin America. Didi is also planning to enter into Mexico this year alongside expanding into the other Asian markets, most recently expanding into Taiwan through a franchising model.
Uber has already lost the market in China when Didi Chuxing bought Uber’s China business for $35 billion deal in 2016.
Uber faced the similar market issue in Russia when it agreed to cede its business to Russian competitor Yandex last year with $3.7 billion merger agreement. Yandex is also planning to expand its operations in other Eurasian markets such as Kazakhstan, Azerbaijan, Armenia, Belarus, and Georgia.
Amidst the market consolidation, Didi has emerged as the forceful factor which is leading new financing rounds in ride-hailing companies across the globe.
In 2015, the company invested $100 million in Lyft. It also joined financing rounds for Grab in Southeast Asia and Ola in India. In 2017, in addition to funding 99, it participated in a $2 billion investment in Grab with SoftBank. It has also invested undisclosed sums of money into Careem in the Middle East and Taxify in Europe and Africa.