Uber has sold its food delivery service Uber Eats in India to local rival Zomato, the company announced on Tuesday. As part of the deal Uber will now own 9.99% of Zomato and all the users of Uber Eats will now be part of Zomato, the deal is estimated to be valued between $300 and $350 million.
Uber Eats entered India in 2017 and never been much competition to the local rivals Zomato and the market leading Swiggy in terms of orders per day.
“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,” said Dara Khosrowshahi, chief executive of Uber, in a statement.
“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,” he added.
According to industry estimates Ola is leading Uber in terms of ride-hailing service in India with as much as twice rides processed per day in 110 cities of the country compared to roughly three-dozen cities’ presence of Uber.
As for Uber Eats employees in India, some of them have been given the option to join Uber while rest will be let go as informed by some sources.
Zomato has earlier raised $150 million from Ant Financial and is expected to raise another $400 million in the next few weeks.