Zomato May Soon Buy Out UberEats in India to Fight Against Swiggy
The food-delivery giant has shown interest in buying Uber’s food business in India by the end of the year.
The online food delivery in India could soon become a duopoly market if the reported news about Zomato buying UberEats comes through.
This has been mentioned in a TechCrunch report on Monday, quoting multiple sources who’re aware of talks happening between both the companies, which is claimed to have reached an advanced stage. The report further points out the deal “currently values UberEats' India business at around $400 million (Rs 2,840 crore).”
Many have pointed out UberEats’ delayed entry into the Indian market has played a big role in lack of demand for the service, where it has been competing with established names like Zomato and Swiggy. Even FoodPanda, after its acquisition by Ola, failed to rack up the numbers, forcing the cab aggregator to shift its business focus elsewhere.
Both UberEats and Zomato refused to comment on the supposed development, but this report mentions that a final deal is likely to be concluded before the end of the year.
So while Swiggy and Zomato continue to add more cities to their areas of operation in the country, UberEats, seems to be heading in the other direction, by keeping its business running without any heavy investment.
This report comes a few months after the Economic Times had mentioned that UberEats will be bought by Swiggy. ET also reported that this move by Uber was to be part of its strategy to cut its losses in preparation for its $120 billion public offering.
But the deal fell through owing to a difference in valuation between both the companies.
In terms of daily orders, UberEats is way behind its competition. Uber’s global strategy has shown that wherever the food delivery business isn’t working out as a top or second-best player in the segment, the division is slowly but gradually given the cold shoulder.
It will be interesting to see how Zomato, once the deal goes through, plans to utilise the resources picked off UberEats, including its workforce.
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