Zomato will soon enjoy at least 55 percent of market share of food delivery business in India because it has acquired Uber Eats.
Zomato on Tuesday announced that it has acquired Uber Eats’ business in India. And, with the deal, Uber Eats will enjoy a 9.99 percent ownership in Zomato.
Uber Eats will discontinue operations in India with immediate effect, and agreed to direct its restaurants, delivery partners and users to the Zomato platform.
Delivery partners of Uber Eats India will add to Zomato’s fleet.
And with 55 percent share in India’s food delivery market, Zomato would now pose a big challenge to Swiggy, an Indian company in the business.
Zomato definitely has operational advantages over Swiggy as it delivers food in over 550 cities in India.
Uber is a basically a ride-hailing company, decided to dispose its food delivery business as it was running in loss.
The MNC had entered the food delivery business in 2017 and had spread the network in 41 cities in India, with over 65,000 riders who deliver food from 26,000 restaurant partners.
But Uber Eats could not survive in the highly competitive food delivery market. Unfortunately, about 250 Uber Eats employees will be jobless from Tuesday.
“This acquisition significantly strengthens our position in the category,” Deepinder Goyal, CEO of Zomato, said.
On the other hand, Dara Khosrowshahi, CEO of Uber said the company would continue to focus on further strengthening its ride-hailing business in India.
This time, Uber will probably try its best to take on rival Ola.
“India remains an exceptionally important market to Uber, and we will continue to invest in growing our local Rides business,” Khosrowshahi, said.