In a move to cut its global spending American ride-hailing giant Uber, might sell its food delivery service UberEats’ India to local food delivery giant Zomato.
The deal if happened will value UberEats’ India business at around $400 million, Uber also plans to invest around $200 million in Zomato and grab a sizeable stake.
According to the sources, Uber and Zomato are in talks to negotiate the terms, meanwhile, if sources are to be believed, the deal could happen before the end of this year.
The ride-hailing giant launched its food delivery service in India in 2017. Though it offered several offers and mega discounts to win customers, UberEats failed to keep pace with Zomato and Swiggy, both of which are major market players in the country with over 1 million orders each day. In comparison, UberEats’ daily volume marks nearly 600,000 orders, according to the sources. UberEats’ India recorded negative revenue of $107.5 million for its business in the period between August and December of this year.
Furthermore, constant losses have saw departure of two key resources from the firm — Bhavik Rathod (UberEats’ India and Southeast Asia head), and Deepak Reddy (head of central operations for UberEats in India).
Not just Uber, Zomato has also reduced its burn rate. Zomato, which was losing more than $40 million each month in 2018, has cut its monthly loss to $20 million, according to TechCrunch. On the other hand, Swiggy continues to expand and explore more food delivery categories.