Meituan-Dianpin — a Chinese review site similar to Yelp in the west — has acquired the country’s biggest bike-sharing company Mobike for a cool $2.7 billion.

The loss-making Mobike will use the backing of Meituan-Dianpin — itself worth $30 billion — to grow in the face of increased competition from the likes of local rival Ofo.

China’s bike-sharing companies have begun expanding overseas in recent years, with bikes popping up in the UK, the US, and Paris.

It’s thought Mobike burns cash to the tune of around $50 million a month and Ofo around $25 million, according to a Financial Times report.

Last year Mobike raised $600 million in a financing round led by Chinese internet giant Tencent. Mobike’s other investors include Sequoia Capital China and TPG Capital and was last valued at $3bn, according to CBInsights.

Meituan is planning a stock market float in the near future and the move will likely add investor pressure on the company to perform.

What was said:

Meituan CEO Wang Xing said in a social media post that the Beijing-based company will “build a new future with Mobike”.

Hu Weiwei, a co-founder of Mobike, took to WeChat to preempt suggestions this was the end for Mobike. She said:

There is no so-called exit. The way I see it, this is a new beginning.

She added that “it is a new beginning” and that there’s “huge space for imagination” to work with Meituan.

Zhao Xiang, an analyst at Beijing-based consultancy Analysys, told the South China Morning Post:

The tie-up with Mobike is also expected to help Meituan gain more customers data to help its push into transportation.

3 Things That Will Change the World Today

Why it matters:

China’s biggest tech titans — including the likes of Tencent and ecommerce giant Alibaba — are looking to consolidate their power in China as they turn their gaze increasingly overseas.

Earlier this week Alibaba snapped up food delivery service Ele.me — Meituan biggest competitor — and also backs Mobike competitor Ofo.

Meituan also expanded into ride hailing services in China last month, competing with Didi Chuxing — the company that forced Uber out of China.

Background:

Mobike, which first launched its bikes in China in 2016, is one of the largest bike-sharing providers worldwide with over seven million bikes in more than 180 cities across the globe.

Mobike boasts a 70% of market share in China and has grown rapidly after bicycle-sharing took off in the country in late 2016, with dozens of startups placing millions of two-wheelers on city sidewalks, funded by venture capital money.

The bike-sharing industry could be worth $3.8 billion by 2019, according to market research firm iResearch.