Didi buys into Brazil ride-hailing company

Chinese ride-hailing platform Didi Chuxing bought a controlling stake in Brazil's 99 on Thursday, Uber's main rival in Latin America's largest economy, marking the company's first cross-border acquisition on its drive toward globalization.

Though the company did not disclose the stake acquired or its value, local media Valor Economico reported that the deal valued 99 at $1 billion and the New York Times said Didi is investing $600 million into 99, giving it "complete control" of the company, and will add additional cash on top of that.

The move came after Didi spent around $100 million to obtain a minority stake and some management rights in the Brazilian company last year.

The latest acquisition reflects the Chinese startup's intensified efforts to accelerate its global footprint.

"Globalization is a top strategic priority for Didi," said Cheng Wei, founder and CEO of Didi. "The success that founders and the team of 99 have achieved in Brazil embodies the very spirit of entrepreneurship and innovation in the region."

The Beijing-based startup has beefed up its global presence mainly through investing in major international players, including Lyft, India's Ola, Singapore-headquartered Grab, Estonia's Taxify, and Careem in the Middle East.

This time, the startup is opting to move forward through mergers and acquisitions, followed by its raising of another $4 billion in funds from investors a few weeks ago.

"The acquisition, rather than pure investment, means that the company has more decision-making power on its counterpart's development in the future, which reveals a strategic upgrading of Didi while boosting its presence on the global stage," said Wang Xiaofeng, a senior analyst with research firm Forrester.

Wang added that the purchase will also deal a blow to its biggest rival Uber Technologies Inc, especially in Brazil, as Didi is doing quite well in localization and will change its strategy according to the maturity of different markets.

99, also known as 99 Taxi, has a total of 14 million users and over 300,000 drivers in Brazil, which, with a population of more than 200 million people and a relatively underdeveloped public transportation network, is a potential emerging market, and offers great opportunities for ride-hailing companies such as Uber and Didi.

Ma Si contributed to the story.