Tencent-backed Meituan-Dianping buys out Mobike for $3.4bn
Last week, Meituan-Dianping agreed to buy Chinese bike-sharing company Mobike. It has now been reported that the deal will be worth around $3.4bn. This makes it the most significant bike sharing deal to date according to Tech in Asia, which stated it was important “not just in terms of value, but also the impact it will have on the industry”.
Meituan-Dianping is one of China’s most valuable startups. The business offers a diverse range of online services from online shopping and food delivery to hotel and restaurant booking and reviews. This range is in part due to the fact that the company was formed through the amalgamation of two startups. It has now even launched a ride-hailing service.
Tech giant Tencent has a stake in both Meituan-Dianping and Mobike.
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This is the latest in a trend of successful tech companies investing in the growing bike-sharing market, particularly in Asia.
Ofo, the other main bike-sharing platform in China, was recently invested in by Alibaba. This was part of a funding round worth $866mn and left Alibaba with a place on Ofo’s board. Another existing investor in Ofo was Didi Chuxing.
Meanwhile, Singapore’s bike offering oBike launched a strategic partnership with Grab. Grab is Singapore’s primary ride-hailing service, which recently bought Uber’s Southeast Asian operations. The deal meant the GrabPay app would be integrated into oBike’s service so users can avail of another cashless payment option and earn GrabReward points from using the bikes. It also meant Grab branding would appear on all oBikes. The two firms stated that they planned to launch a series of joint ventures in the near future.
As for Mobike, it has been stated that the core management team will remain in place, with the startup’s co-founders still largely in charge. However, Meituan-Dianping’s CEO Wang Xing will become chairman of Mobike.
In addition, it has been reported that Meituan-Dianping has taken on around $700mn worth of Mobike’s current debt. It hopes to reduce costs for the company and continue to grow, with the possibility of an IPO in the future meaning it will need to tidy up its finances and reduce losses as much as possible.
