On Tuesday morning, Gurugram based food tech unicorn startup Zomato gained Indian food delivery division of San Francisco-based ride-hailing giant Uber, Uber Eats in an all-stock deal of around Rs. 2485 crores ($350 million).
The step to cut the losses came after Uber observed low contribution from its food business in India to its global business.
The deal brought Uber to enjoy a 10% stake in Zomato.
While the deal has bought a big step towards consolidation in the Indian food tech market, there lies clouds on Uber Eat employees’ future roles.
As per the speculation, Zomato will not absorb Uber Eats employees, as a result, they could either be absorbed in Uber’s other verticals or could face lay-off.
Big Wins for Zomato
- The deal has showered massive gains for Zomato, and it’s quite a lot, actually
- The startup gets Uber’s delivery partners and Uber Eats’ business details including customer information, delivery partners, an order history
- Translation of Uber Eats’ part of the market share to Zomato
- A strong foothold in Southern India, which, till date, has been Swiggy’s domain
- Top of all, the undisputed market leaders in the food delivery category in India
Deepinder Goyal, Founder and CEO, Zomato
“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.”
Dara Khosrowshahi, CEO of Uber
“Our Uber Eats team in India has achieved an incredible amount over the last two years, and I couldn’t be prouder of their ingenuity and dedication.
India remains an exceptionally important market to Uber and we will continue to invest in growing our local Rides business, which is already the clear category leader.
We have been very impressed by Zomato’s ability to grow rapidly in a capital-efficient manner and we wish them continued success.”
From all foodies: We hope the newly committed couple bring delicious food at surprising prices for us!