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China’s Meituan trying to buy large stake in bike sharing firm Mobike
 
A Mobike bike-sharing bicycle is pictured in Singapore August 29, 2017. Photo: Reuters
 
China’s food review and delivery giant, Meituan-Dianping, is buying a large stake in bike-sharing firm Mobike, Caixin, a Chinese business magazine, reported on Tuesday citing unnamed sources.
 
Caixin cited sources familiar with the matter as saying that the deal was brokered by Pony Ma Huateng, CEO of Tencent Holdings Ltd., which is a big backer of Meituan.
 
Technology portal Lanjing TMT reported on Tuesday that Meituan will acquire Mobike for $3.7 billion. But a source close to Meituan’s board said the amount is incorrect because the deal is not yet sealed.
 
According to Yicai, a Chinese business news media, Meituan was not the only company interested in investing in Mobike. Chinese ride-hailing giant Didi Chuxing and its Japanese investor SoftBank also offered an investment in Mobike. Didi, however, denied the rumor, Yicai reported.
 
Mobike is one of China’s largest bike-sharing firms and raised $600 million last June in a financing round led by Tencent. Its rival Ofo is backed by Chinese e-commerce giant Alibaba Group Holding owned by Jack Ma Yun.
 
Ofo, which reportedly has been under financial pressure since mid-2017, said last month that it secured $866 million in a fundraising led by Alibaba, according to Caixin.
 
Meituan-Dianping, also an online platform for booking movies and restaurants, was valued at $30 billion last October and is now preparing for an initial public offering in Hong Kong, according to Reuters.
 
Meituan is now stepping up its own efforts in the ride-hailing business, and has already rolled out services in Nanjing and Shanghai, posing a threat to Didi Chuxing’s dominant position in the industry.
 
Meituan’s entry into the bike sharing industry is expected to accelerate competition between Tencent and Alibaba which this week agreed to acquire full control of Ele.me, Meituan’s primary competitor, in a deal that implies a $9.5 billion valuation for the startup.

 


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