Zomato acquired Uber Eats India in an all-stock deal for USD350 Million
TechSci Research | February 11, 2020
India: Indian food delivery market is quite diverse and has an ample number of food delivery applications with Swiggy and Zomato occupying lion’s share in the market. In order to increase its market share, Zomato has acquired Uber Eats, which is an online food ordering & delivery platform owned by Uber, in an all-stock deal worth USD350 million. This recent conjunction of Zomato and Uber Eats is expected to enhance the customer base for Zomato as this new combination will allow the company to acquire around 50-55% of the overall food delivery market. Additionally, as part of this acquisition, Uber Eats will discontinue operations in the country and will direct delivery partners, restaurants and users to the Zomato platform. The deal gives around 10 percent ownership to Zomato in the Gurugram headquarters . However, Uber Eats will continue its operations outside the country as an independent entity. Zomato is an Indian restaurant aggregator & food delivery platform with a customer base of over 70 million and provides information on over 1.5 million restaurants across 24 countries.
CEO of Zomato stated, “We are proud to have pioneered restaurant discovery and to have created a leading food delivery business across more than 500 cities in India. This acquisition significantly strengthens our position in the category.”
CEO of Uber further added, “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”.
According to TechSci Research, the amalgamation of Zomato and Uber Eats in India will fetch a large customer base, as the merger of two companies is also a merger of their customer bases. Consequently, this will result in a rapid increase in the market share of Zomato in the India online food ordering & delivery market. Factors such as rewards & cashback offers, food delivery to doorstep, among others are contributing to the growing demand for India online food ordering & delivery market.
According to the recently published report by TechSci Research, “India Online Food Ordering and Delivery Market By Operation Type (Food Aggregators & Restaurant-based), By Source (Online (Mobile App & Web) & Offline), By Payment (Mobile Wallet, Card Payment, Cash on Delivery & Net Banking), Competition, Forecast & Opportunities, 2024”, India online food ordering and delivery market is anticipated to register a steady growth during the forecast period. Restaurants and cafes also find it profitable to sell their food through online mediums since it reduces significant amount of operational overheads. College students, office employees including working couples are the key target audiences of food delivery companies. Online food delivery is a service, where a store or restaurant delivers food to a customer through the restaurant’s website ore dedicated food ordering portal/app. Deliverables include drinks, food, and desserts, etc. Payment mode may be online and cash on delivery. Some features for making successful online food delivery market include generate-a-code referral system, easy & user-friendly dashboard, social media integration, customer integration with push notifications and cross-platform compatibility, etc.
According to the recently published report by TechSci Research, “India Online Grocery Market By Category (Packaged Food & Beverages, Personal Care, Household Products, Fruits & Vegetables, Others), By Platform (Mobile Application & Desktop Website), By Region, By Company, Competition, Forecast & Opportunities, 2024”, growth of online grocery market in India can be majorly attributed to rising number of internet and smartphone users. Moreover, the increase in number of working women, technically advanced millennials and ultra-secured payment infrastructure are the major drivers for online grocery market in India. India online grocery market is projected to grow from around $ 569 million in 2018 to $ 3.6 billion by 2024. The market is categorized into packaged food & beverages, personal care, household products, fruits & vegetables and others. Packaged food & beverages segment holds the largest market share, while the personal care and household products segments are expected to grow at the fastest pace over the coming years. Moreover, packaged food & beverages category is expected to hold its dominance on account of increasingly fast-paced ever-changing consumer lifestyles, rising per capita income levels, among others.