Online food delivery platform Zomato has acquired the Indian segment of Uber Eats, the food business run by cab-hailing Uber. The deal is said to be closed for $350 million (Rs 2,485 crore), according to two people who knew about the deal said.
A person who witnessed the deal said, “The deal is signed and customers are going to be directed away from Uber Eats to Zomato. For Zomato, buying the distant third player helps it consolidate the market and puts it ahead of its arch-rival Swiggy. It is one less competition for the company to deal with.” He also added that Zomato expects to transform 90% of Uber Eats users onto its platform.
The deal has been in the works for over a year. This acquisition also makes it the first big merger of the food-delivery market, led by Swiggy and Zomato. The combined entity of both the food delivery platforms is expected to be more than 50-55% market in terms of the number and value of orders. This move leapfrogs Swiggy.
An Uber executive said, “In parts of Tamil Nadu, Kerala, and Madhya Pradesh, Uber Eats has a stronger foothold compared to Zomato with an about 30% market share.”
Uber Eats forayed into the food business back in 2017 when Zomato and Swiggy were already established.