Zomato buys Uber’s food delivery business in India for $350 million

Uber Sells Indian Food Delivery Arm to Zomato

Calling it a "key moment" in Zomato's journey, Mr Goyal wrote: "We have acquired Uber Eats India and with this development, we are the undisputed market leaders in the food delivery category in India". About 200 Uber Eats India employees will be impacted by this deal, as Zomato is not absorbing them.

"Through this deal, Uber Eats India users now become Zomato users".

The share-swap arrangement and details of the transaction were not disclosed.

Zomato said Uber Eats in India would discontinue operations and direct restaurants and delivery partners to the Zomato platform, effective January 21.

Zomato has paid $350 million or roughly Rs 2800 crore to acquire Uber Eats, and in return, Uber will now control 10% stake in Zomato. The transportation company has already sold operations in China, South East Asia and West Asia to local competitors and the sale of Uber Eats in India to Alibaba-backed Zomato adds to a long list of divestitures the company has made post its disappointing public offering past year. You can still get rides via the Uber app, which remains active and available.

Uber said India would continue to be its priority.

The deal marks yet another leg in a wave of consolidation sweeping the food delivery sector.

The deal is likely to give Zomato an edge over its rival Swiggy in a fast-growing but fiercely-contested sector. This acquisition significantly strengthens our position in the category.

Uber's CEO, Dara Khosrowshahi, said the company is proud of the Uber Eats team's achievement in India, but it sounds like nothing more than lip service. The deal comes days after Zomato raised $150 million funding from existing investor Ant Financial, valuing the company at $3 billion.

Offloading Uber Eats India would help Uber, which left Southeast Asia past year, reduce its global losses. Over the last few years the former had seen a rapid rise and now has a bigger market share than Uber.

Moreover, select UberEats users will be getting some impressive offers from Zomato as well, including 50% off on the first 3 orders, along with a free 3 month subscription to Zomato Gold.



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