Didi is bolstering its international presence in a major ride-hail market: Brazil. The company announced that it is buying taxi and private car-hailing company 99.
The acquisition comes almost exactly a year after Didi led a $100 million investment in 99, formerly called 99Taxis. As part of the investment, a Didi executive joined 99’s board.
Didi will be acquiring the company for around $600 million. The New York Times first reported the price.
This acquisition complicates an already complex web of ride-hail relationships. After Didi acquired Uber’s China assets, it also bought a stake in Uber itself for $1 billion. All three companies, including 99, are now backed by SoftBank — and yet in places outside of China, Didi is competing with Uber.
The relationship between Didi and 99 has been long in the offing. The now-CEO of 99, Peter Fernandez, had been in talks with Didi leadership about working together in some capacity as early as April 2016. That relationship was formalized with Didi’s investment.
Brazil is an important market for Uber, and Didi wants to compete with Uber there head on. Now that China is no longer one of the markets Uber operates in, Latin America as a whole has been the fastest-growing region for the embattled ride-hail player. The company has had such a stronghold in Mexico that few competitors — including 99 — were willing to attempt an expansion into what was the company’s third-biggest country market in 2015.
“Brazil is a must-win market in the world,” Fernandez told Recode in a previous interview. “It has the world’s fifth-largest population. From my perspective, it’s a much more important priority for the company to win in Brazil than it is to peanut-butter our operations across the region.”
That may change now that the company has Didi’s full backing. While Didi has been thoughtful about how it enters new global markets, often buying stakes in Uber competitors in important markets like Europe and the Middle East, the company said it would be focusing a good deal of its recent $4 billion round of funding on international expansion. Still, Uber has seen incredible success in places like Brazil where it sees the most trips globally in Sao Paolo and Rio.
This is developing ...
This article originally appeared on Recode.net.