Lawstreet Journal

Zomato Acquires Uber Eats India, Becomes Undisputed Market Leader

Lawstreet Journal 21 Jan 2020 7:31pm

Image courtesy: Lawstreet Journal Business Zomato Acquires Uber Eats India, Becomes Undisputed Market Leader

Well-known food delivery company, Zomato has acquired Uber Eats India by Uber Technologies. Uber Eats was incurring losses because of the failure of its food delivery business globally. Zomato has confirmed the transaction of sale that happened between the two on a blogspot today (January 21, 2020). Zomato is the leader in the food business market currently having a net worth of $2.2 billion dollars.

New York Times has reported that Uber will be getting a 9.9% share in Zomato’s stock, in exchange for its food business thereby maintaining a foothold in the online food business arena. Neither of the companies have divulged information about the valuation of the deal but reports suggest that it accounts for around $300-$350 million. 

This transaction has marked yet another achievement in the ongoing wave of consolidation. Uber’s goal is to become profitable as per the EBITDA profitability margin by 2021 as a ride-hailing giant in the world with only one other significant competitor – Ola. Stepping out of the food business is just another move towards achieving that goal.

The EBITDA margin measures a company's earnings before interest, tax, depreciation, and amortization as a percentage of the company's total revenue. This margin is considered to be the best indicator of a company’s financial health since it does not take into account a company’s accounting or tax decisions. It calculated the total amount of cash profits that a company is making within a year.

Uber had begun its food delivery career in India in 2017 but has failed to successfully… Continue Reading...

Tagged: Zomato   Uber  
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