Uber set to buy rival Careem for US$3 billion: report

March 25, 2019 08:28
Uber is offering to buy Dubai-based rival Careem Networks FZ ahead of its planned initial public offering. Photo: Reuters

Uber Technologies is set to offer over US$3 billion to buy Dubai-based rival Careem Networks FZ, Reuters reports, citing two sources familiar with the deal.

Uber’s offer could be unveiled during the early part of this week, a third source added.

Uber will pay US$1.4 billion in cash and US$1.7 billion in convertible notes, which will be convertible into Uber shares at a price equal to US$55 per share, Bloomberg had earlier reported, citing a term-sheet.

Careem declined comment while Uber did not immediately respond to a request from Reuters to comment.

Uber has been preparing for an initial public offering, and its bankers have indicated that it could be valued at as much as US$120 billion.

The US-based global logistics and transportation company has been seeking new avenues of growth even as it faces severe competition in its core business of ride-hailing from rivals like Lyft.

The IPOs of Lyft and Uber represent a watershed for Silicon Valley’s technology unicorns, which for years have snubbed the stock market in favor of raising capital privately, with investors happy to back their frothy valuations.

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