Two of the biggest players in the Chinese ride-hailing industry are set to merge forces. Uber Technologies recently announced that it is selling its China business to competitor Didi Chuxing, which happens to be the biggest ride-hailing service in the country. The deal will put an end to the ongoing battle for dominance between the two giants.

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The combined value of the two companies, Uber China and Didi Chuxing, are estimated to be around $35 billion. Investors of Uber China, which includes Chinese tech giant Baidu, will receive a 20 percent stake in Didi Chuxing. Following the deal, Uber will continue to operate its app in China for now.

The deal between Didi Chuxing and Uber China is considered a complicated one by many experts. It includes a stipulation that requires Didi Chuxing to invest $1 billion into Uber.

In a statement, Uber chief executive officer Travis Kalanick said, "As an entrepreneur, I've learned that being successful is about listening to your head as well as following your heart. I have no doubt that Uber China and Didi Chuxing will be stronger together."

According to some industry experts, the merger between Didi Chuxing and Uber China may complicate some of the latter's international alliances. Didi Chuxing is working with Lyft in the United States, Ola in India, and Grab in several Southeast Asian markets. According to Tech Node, Didi Chuxing also has a $1 billion investment in U.S. tech giant Apple.

In 2015, Didi and Kuaidi merged into a single company which created China's biggest ride-hailing service. The merger put together two of China's most valuable Internet businesses, Alibaba Group Holding and Tencent Holdings.

TagsUber, Uber China, Didi, Didi Chuxing, ride-hailing, china