Zomato has announced that it will acquire the Indian operations of Uber Eats, the food delivery business run by Uber, for around $350 million (Rs 2,485 crore).
Uber Eats will cease to exist as a separate brand locally and users on its platform will be redirected to Zomato’s app.
The all-stock transaction will give Uber Eats about 10% shareholding in Zomato. Zomato will not absorb Uber Eats' team in India. This means around 100 executives will either be reallocated to Uber’s other verticals here or laid off.
The transaction has been in the works for more than a year. The transaction marks the first big consolidation move in the hotly contested and cash-intensive online food-delivery market, led by Swiggy and Zomato. Uber Eats has been on the block for a year. In February last year, Uber had come close to selling the business to Swiggy but the deal fell through.
With the acquisition, the combined entity of Zomato and Uber Eats India is expected to corner more than a 50-55% market in terms of the number and value of orders, pulling it ahead of Swiggy.
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