Meituan Absorbs Mobike for USD2.7 Billion, Reportedly Beating Higher Bid From Didi

Liu Jia

(Yicai Global) April 4 — The company behind China’s biggest on-demand services provider Meituan has acquired loss-making bike sharer Beijing Mobike Technology Co. for USD2.7 billion, beating out higher rival offers.

More than half of Mobike’s preferred shareholders agreed at a general meeting last night to Beijing Sankuai Online Technology Co. taking over, a source close to the target told Yicai Global. The deal gives Meituan all of Mobike’s shares.

The world’s largest ride-hailing provider Didi Chuxing Technology Inc. and Japanese conglomerate SoftBank Group Corp. reportedly combined to offer more cash and pledged to invest USD1 billion into the bike-sharing giant, taking a smaller stake in the company and not becoming a controlling shareholder, the source said. Didi denied bidding.

“Many shareholders seek advice from me,” Mobike Chief Executive Wang Xiaofeng reportedly said at a speech during the meeting. “If the company seeks independent development, there will be big opportunities but also big challenges, and I have no solution. I believe our investors can make their own judgment.”

Wang was relieved that the team had at least made some money and admitted he had made mistakes with the company. He had hoped to see the company develop by itself, he said, but believes startups cannot compete with existing giants.

China’s biggest tech firm Tencent Holdings Ltd. backs Mobike, Meituan and Didi Chuxing. It has about a 20 percent stake in Mobike. Tencent Chief Executive Pony Ma brokered the acquisition, according to finance and business magazine Caixin.

Speculation emerged at the end of last year that Mobike could merge with archrival Beijing Bikelock Technology Co., better known as Ofo. Many investors said they believed it was just a matter of time before the two combined as China’s bike-sharing market is becoming ever-more saturated and cut-throat. But Ofo founder Dai Wei is said to have opposed the merger.