Chinese taxi-hailing apps Didi Dache and Kuaidi Dache announced merger on Saturday after a year of break-beck competition for market share.

The two firms will retain their own brand and business after the merger. Both Didi and Kuaidi's current CEO will co-chair the newly-founded company that analysts say could be valued at 6 billion U.S. dollars.

Kuaidi holds a 56.5 percent share of China's taxi-hailing app market, while Didi accounts for 43.3 percent as of December, according to research consultancy Analysys International.

Didi and Kuaidi has received backing from Chinese internet giant Tencent and Alibaba respectively.