Uber has sold its online food-ordering business in India to local rival Zomato in exchange for a 9.99 percent stake in the latter, which is backed by China’s Ant Financial, Reuters reports.
The all-stock deal is likely to push Zomato to the top position in India’s food delivery market, ahead of Swiggy, which counts China’s Tencent Holdings as an investor, the report noted.
Zomato, which was valued at around US$3 billion after raising money from Alibaba affiliate Ant this month, said Uber Eats in India will discontinue operations, and direct restaurants, delivery partners and users to the Zomato platform from Tuesday.
“India remains an exceptionally important market to Uber and we will continue to invest in growing our local Rides business,” said Dara Khosrowshahi, Uber’s chief executive officer.
Uber Eats in India accounted for 3 percent of the business’ gross bookings globally, but more than a quarter of its adjusted EBITDA loss in the first three quarters of 2019, the US ride-hailing firm said.
Uber Eats, which also pulled out of South Korea earlier this year, said it will continue to operate in Bangladesh and Sri Lanka.
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