Uber Nears $400 Million Deal to Sell Indian Food Delivery to Zomato
Uber is in advanced talks to sell its struggling Uber Eats business in India to local competitor Zomato for roughly $400 million. The proposed deal includes an additional Uber investment that gives the ride-hailing giant a sizable stake in Zomato.
Uber is in advanced negotiations to sell its Indian food delivery service, Uber Eats, to local rival Zomato for approximately $400 million as the American company attempts to reduce its global spending. As part of this proposed agreement, Uber plans to invest between $150 million and $200 million directly into Zomato to secure a significant stake in the eleven-year-old firm. The two companies are still working out the final terms, but industry insiders expect the deal to close before the end of the year.
This potential acquisition brings an end to a challenging year-long effort by Uber to offload its underperforming Indian food delivery division. Despite launching in mid-2017 and offering deep discounts to attract users, Uber Eats never truly challenges the market dominance of Zomato and Swiggy, which each process over one million orders daily. At its peak, Uber Eats only manages to reach a daily volume of 600,000 orders.
The struggles for Uber Eats in India deepen in recent months with the departure of two key regional executives. These operational challenges occur alongside Zomato's upcoming $600 million funding round led by China's Ant Financial, which values the Indian firm at $3 billion. While Uber's CEO previously acknowledges the highly competitive nature of the Indian food delivery market, this impending sale shows the company's ultimate strategic pivot away from a market it cannot conquer.