NEW YORK (TheStreet) -- Uber's Chinese subsidiary has agreed to be acquired by its rival Didi Chuxing in an all-stock deal worth $7 billion, Bloomberg TV's David Westin reported on "Bloomberg Go" Monday.

The combined company will form a new entity valued at $35 billion. Both companies will become minority shareholders in each other and both founders and CEO's will sit on each other's boards, Bloomberg TV's Lulu Chen reported.

"In terms of capital in the amount of subsidies money burnt in this battle has become humongous and that's why investors have pushed for this deal," Chen said.

Just a year ago, Uber China's fight against Didi was its biggest battle. In the past 2 years, Uber has burned $2 billion in China alone, she said.

Investors became anxious, hoping that both companies can put an end to the battle where they have been heavily subsidizing passengers to win the market shares, she noted.

Analysts and investors still believe Uber has a chance of competing in countries similar to the U.S. but the company is facing battles in southeast Asia and India from local competitors, she explained.