Uber Eats was in the news recently regarding the rumored possible acquisition by an Indian company. The latest development is that Zomato has acquired Uber Eats for Rs 2500 crore in an all-stock deal. As part of the agreement, Uber will have a share of 10 percent in Zomato. Moreover, Uber Eats will terminate the operations in India with immediate effect. If you visit the official website of Uber Eats, you will view the box to enter the postal code but after that, you will view a message regarding the acquisition. You won’t be able to book any new food offerings via Uber Eats.
The interesting fact is that Zomato won’t be absorbing Uber Eats executives. There are reports that over 100 executives will be either laid off or assigned to other departments within Uber. Even though Uber has shut the food delivery business, the company will continue to operate the cab service.
Commenting on the development, Deepinder Goyal, Founder, and CEO of Zomato disclosed that they are proud to have an AI-based restaurant discovery mechanism. The company has entered into the food delivery business across 500 major cities in India and we are expecting to expand to more cities.
Uber Eats took to Twitter and disclosed that the company entered the food delivery business in 2017 and they are taking a different route. The Cab-owned eating service added that Zomato has acquired them. They are shutting down with immediate effect. The company also wished more good times with great food on the road ahead.
We entered food delivery in India in 2017 and today is when our journey takes a different route. Zomato has acquired Uber Eats in India and we’ll no longer be available here with immediate effect. We wish all our users more good times with great food on the road ahead pic.twitter.com/WEbJNaJY8M
— Uber Eats India (@UberEats_IND) January 21, 2020
There were reports that Uber will most likely invest $150 to $200 million in Zomato but we don’t have any official confirmation. According to reports, Uber posted a loss of Rs 2200 crore in the food delivery business by the end of 2019. There are two benefits. Uber can cut down the losses to a large extent. It will also help Zomato to enter those states where Uber Eats have a strong presence.
It remains to be seen as to how Uber Eats customers will reach to the acquisition by Zomato. The customers are already tweeting with information that Uber followed a cost-effective approach by offering great deals and offers for the food. Zomato should offer the same packages to retain customers. Otherwise, Swiggy is waiting on the road.
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