About two months ago Apple Inc. (NASDAQ: AAPL) made its first strategic investment in a ride-sharing company when it dropped $1 billion on Beijing-based Didi Chuxing. Didi’s main competitor in China is Uber China, a subsidiary of U.S.-based ride-sharing leader Uber. Or perhaps it is more accurate to say that Didi was an Uber competitor.

Monday morning, Uber announced its intention to merge Uber China with Didi Chuxing. Uber CEO Travis Kalanick announced the deal on the company’s website. Kalanick explained:

[A]s an entrepreneur, I’ve learned that being successful is about listening to your head as well as following your heart. Uber and Didi Chuxing are investing billions of dollars in China and both companies have yet to turn a profit there. Getting to profitability is the only way to build a sustainable business that can best serve Chinese riders, drivers and cities over the long term.

Didi Chuxing is valued at around $27 billion while Uber China’s valuation is roughly $7 billion. An account at Bloomberg News reports that Didi will acquire Uber China’s brand, business and data in the country and that Uber Technologies and Uber China’s stakeholders will get a 20% stake in the combined company.

Thanks to its $1 billion investment in Didi, Apple will now own a small stake in Uber, thanks to a $1 billion investment by Didi in Uber Global as part of the deal announced Monday morning.

Having a stake in the world’s two largest ride-sharing firms plays into the widely held but unconfirmed view that Apple is getting into the car business. Last week the company reportedly put a senior executive in charge of Apple’s Project Titan, the codename for the supposed automobile project.

How Apple’s car project (if it exists) fits together with investments in ride-sharing companies seems apparent, although the reality is likely more complicated. But the company’s bet on Didi in China turned out to be right and could indicate that it sees more opportunity in the Middle Kingdom than in Middle America. Even if the Chinese combination is valued at about half of Uber’s valuation, the potential pool of consumers is enormous, and Apple has poked its nose into the tent. Stay tuned.

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