In brief: Swiggy set to acquire Uber Eats in India

In what would be one of the most significant consolidation moves in the sector, Uber Eats, the food-delivery arm of the global ride-hailing platform, is in final stages of negotiations to sell its India business to rival Swiggy, three people privy to the development told the Economic Times.

The deal, which is expected to close by next month, will be Swiggy’s largest acquisition to date.

Source: The Economic Times

Sources suggested the deal will be a share swap, which will see Uber obtain a 10 percent stake in food-delivery startup Swiggy.

The US company reportedly held talks with Swiggy’s main competitor Zomato over similar deal, but they came to nothing.

Uber Eats’ Indian business reportedly averages 9 million orders each month with a cash burn of US$25 million, while Swiggy is estimated to burn through as much as US$45 million per month.

Swiggy raised US$1 billion from investors including Naspers and Tencent last December, and was last valued at US$3.3 billion.

Uber is said to be cutting costs in preparation for an IPO later this year, with some estimates valuing the ride-hailing giant at US$120 billion. In recent years, it has sold regional operations – including food delivery – in China and Southeast Asia to local players Didi and Grab, respectively.