As part of the agreement, the companies' chief executives will act as joint CEOs for the new firm.

　　It's been suggested the new company may end up being valued at around 6-billion US dollars.

　　Li Min, spokesperson for the combined operations, says their merger is a "flash marriage" meant to promote market growth.

　　"On top of this, both companies have the same perspective on the taxi-booking app market. In fact, we have negotiated with each other several times. But this time, our negotiation process went very smoothly. It only took around 3 weeks to get a deal. Right now, we can't disclose what stake each side will take in the venture, but both sides will keep their brand identities."

　　中国打车软件巨头合并

　　Didi and Kuaidi, backed by Chinese Internet giants Tencent and Alibaba respectively, have been involved in a price battle to attract customers over the past year, with each offering huge discounts and incentives to passengers and drivers.

　　Some observers have been questioning whether the merger will create a monopoly which may end up being bad for customers.

　　However, spokesperson Li Min is downplaying that concern.

　　"First of all, the transportation market is huge enough. Secondly, our research suggests many people are still hailing cabs in the street instead of using apps. As such, the joint venture will only take up a small piece of a much bigger market, and the so-called monopoly does not exist right now."

　　The merged companies are also going to be working on collaborating in areas such as driver hiring services, car pooling and a mobile app for bus services.

　　With the merger pending, some taxi users fear the days of low-cost cab rides might be coming to an end.

　　"I think the good side of the merger is that users don't need to switch apps any more. But the bad side is that users only get one yuan subsidy from the two companies."

　　"If there are two apps, there still is competition, which benefits customers."

　　Under their current campaigns, both companies are offering passengers up to 15 yuan in discounts per ride.

　　Taxi drivers are able to earn up to 800 yuan a week from the incentives.

　　Both Kuadi and Didi have launched their business in 2012.

　　It's believed Kuaidi holds about 56 percent of the market share in the taxi-hailing app market, while Didi accounts for some 43 percent.

　　For CRI, I am Wang Mengzhen.