Food delivery startup, Uber Eats, has been acquired by Zomato, another food app in India. Uber has received 9.99% ownership in Zomato in an all-stock transaction.
Uber Eats will discontinue its operations in India and all of their delivery partners, restaurants and users will be directed to the Zomato app today onwards.
With this acquisition, Zomato and Swiggy are the only two major players in the food delivery business in India, creating a duopoly.
In the announcement, CEO of Zomato, Deepinder Goyal, mentions that they are the ” undisputed market leaders in the food delivery category” in the country.
“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,” said Deepinder Goyal, Founder and CEO, Zomato. Goyal also mentions that there will be a smooth transition of all Uber Eats India users, delivery partners and restaurants to Zomato.
Zomato currently operates in more than 550 cities in India and serves food from a total of 1.5 million restaurants across 24 countries worldwide. According to the company data, they cater to 70 million users every month.
“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,” said Dara Khosrowshahi, CEO of Uber.
Uber Eats, a subsidiary of ride-sharing giant Uber, started its operation in 2014 in the US and launched in the Indian market in 2017. While Uber’s ride app will continue to function, its food delivery service ends immediately.