BEIJING, Aug. 1 (UPI) -- Uber Technologies announced plans Monday to sell its business in China to rival ride-hailing service Didi Chuxing in a deal that values the merged Chinese company at $35 billion.
U.S.-based Uber will receive a 17.7 percent economic stake in the combined company, according to a statement issued by Didi. Uber China's previous investors, including Chinese Internet company Baidu, will have a 2.3 economic interest in the combined company. Also, Didi will invest $1 billion in Uber.
The deal combines Didi's latest $28 billion valuation and $7 billion value for Uber China, according to CNBC.
Didi will acquire Uber's brand, business operations and data.
Didi Chief Executive Cheng Wei will join Uber's board of directors, and Uber Chief Executive Travis Kalanick will be part of the board of Didi Chuxing.
"Didi Chuxing and Uber have learned a great deal from each other over the past two years," said Cheng, who is also CEO, in the statement. "This agreement with Uber will set the mobile transportation industry on a healthier, more sustainable path of growth at a higher level."
The two companies had been in fierce competition for two years, offering deep subsidies to attract drivers and riders.
Those cheap rides will end, but now "Didi can spend more time to improve the user experience," Yi Beichen, a technology analyst and author of The Era of Mobile Internet, told the Los Angeles Times.
Uber China operated in more than 60 cities in the country with plans to reach 100 by year's end. Uber China had only 200 employees compared with 4,000 with Didi Chuxing.
Didi, launched in July 2015, was offered in 200 cities, according to the company's website.
Last year, China's ride-hailing leaders Didi and Kuaidi merged.
Didi had agreed to work with the U.S.'s Lyft Inc., India's Ola and Southeast Asia's Grab.
Last week, the Chinese government issued ride-hailing regulations that will allow companies to legally operate in the country. The new rules, which will take effect Nov. 1, require companies and their drivers to apply for and receive licenses through the government.