No More Uber Eats in India. Yesterday’s big news- Reportedly Zomato has acquired Uber Eats (India Operation) in an all-stock deal. Although there hasn’t been any official declaration of the amount, several sources assumed the amount could be around 350 million USD (BDT 3000 Crores Approx.).
The all-in stock transaction will give Uber around 10% ownership in Zomato. As a result of the acquisition, Uber Eats will discontinue its operation in India and all the existing customer base of Uber Eats will be transferred to the Zomato platform.
Reportedly Zomato CEO Deepinder Goyal has said-
“We are proud to have pioneered restaurant discovery and to have created a leading food delivery business across more than 500 cities in India. This acquisition significantly strengthens our position in the category.”
Uber Eats India is now Zomato. Here's to better food for more people, and new beginnings.
— Deepinder Goyal (@deepigoyal) January 21, 2020
The acquisition took place as a result of eliminating the loss-making sectors after their recent post IPO revenue struggle. Reportedly, the company was losing around $20million USD per month in India. Based on that regard, it was not a bad call from Uber either.
Read More: Uber: Failure of IPO. Reasons and Consequences
Saddening is that Zomato will not be absorbing the employees of Uber Eats. Hence, hundred of Uber Eats executives will either be transferred to another sector of Uber or fired.
Funny thing is that last year in February, Uber was close sell their food delivery unit to Zomato’s arch-rival Swiggy. But the deal did not go through for some financial disagreement between the companies.
With the acquisition, the joined substance of Zomato and Uber Eats India is relied upon to corner in excess of a 50-55% market regarding the number and estimation of orders, pulling it in front of Swiggy.
Well, the food delivery business has always been a cash-burning industry. The only thing you need here is to provide speedy convenience to the customers and that costs money. As a result, the acquisition took place only after the recent staggering 150million USD funding by the existing investor Ant Financial (An Alibaba Affiliate) at a 3 Billion USD valuation.
So, what’s your opinion on the acquisition from Zomato? Do you think Zomato will have a say on Uber Eats Bangladesh as a point of entry in Bangladesh as well? Let us know.