Uber sold its food delivery business to one of its top most rivals, Zomato. Uber’s overall stock was estimated near to USD 300-500 million and it will have the share of 9.99 percent stake in Zomato.

Uber Eats was introduced in India in the year 2017. The company incurred great loss and with the decline in its growth rumours started to spread about acquiring the business by Zomato at the beginning of 2019. Uber Eats used to retain its customer through discounting process, although Uber was successful to gain a place in the market of small cities and towns. According to a report Swiggy is the leading company in food delivery market. Zomato plans to lead the market in the consecutive year after taking over the Uber Eats.

“The company will onboard all Uber Eats customers, Restaurant partners, and driver-partners on its own platform”, as said by Deepinder Goyal, CEO and Co-founder, Zomato.

“The company is proud of the Uber Eats team’s achievements in India, but it sounds nothing more than lip service. Uber Eats bled a lot of money last year”, said, Dara Khosrowshahi, CEO, Uber.

Related Personnel revealed that Uber’s global food business revenue was only 3 percent in India but the losses incurred during the last year was of 25 percent. The total loss was estimated to be the worth of USD 500 million in a year. Zomato aims to eliminate the losses and make profit by the year 2021.

 “In parts of Tamil Nadu, Kerala, and Madhya Pradesh, Uber Eats has a stronger foothold compared to Zomato with an about 30 percent market share,” an Uber executive, who didn’t want to be named, told. The acquisition, therefore, will give increased access to Zomato in certain micro-markets, he said.

Zomato and Uber together denied comments when they were contacted to comment on the issue. The transaction was in progress from couple of years, this is considered to be the first strengthening action on this debated issue.