No More UberEats In India?
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UberEats the food delivery business of Uber may soon exit from India. The Gurgaon based food startup Zomato is in frontrunner to acquire UberEats. The Deal Size for UberEats may change, but as now looking for $500 million for its food delivery.
Uber may also invest in Zomato’s next financing round. When it comes to the Indian food delivery business UberEats is a distant third in comparison with Zomato and Swiggy. The daily order of Zomato and Swiggy is around 2 million, whereas the order of UberEat is somewhere between 2- 2.5 lakhs comparatively less.
The average order value of UberEats is almost half of Zomato and Swiggy. UberEats want to focus on small markets where they can be a first or second player. On the Other Side, Zomato is in the middle of raising funds from existing backer Ant Financial for $200 million and this funding series will value Zomato at $3 billion.
In September UberEats shut down its business in South Korea where food delivery service Baedal Minjok owns a 75 percent market share. It faces tough competition around the world. In the U.S, Uber Eats straggles back DoorDash and GrubHub.
In Europe its up next to the likes of Deliveroo and recently merged with Just Eat and Takeaway. Early 2019 Uber eats had also held discussions with Swiggy, Zomato even Amazon India for a sale but the deal didn’t materialize. The sudden sale talks come after an unimaginative IPO, with the share price fell more than 33 percent has been struggling to maintain its food delivery business in India.
This deal will help Zomato to gain more market share and also to grow its presence in South India, where Swiggy has a powerful presence.UberEats is expected to lose $15-20 million for 2020 in India. UberEats, which began in India in 2017 is reported to have above 25000 delivery executives employed across cities in India. The major problem now Zomato facing that the Indian Hotel and Restaurant Association (AHAR), is to shun the Zomato gold service over a sharp discount.