After months of speculation, it has been confirmed that Uber plans to acquire its Middle Eastern rival Careem in a deal worth $3.1 billion. The transaction value is expected to be a record for a Middle Eastern tech startup exit and among the highest globally for ride-hailing mergers and acquisitions.
As part of this deal, which is expected to close in early 2020, Uber will acquire Careem’s mobility, delivery and payments business across the greater Middle Eastern region, which includes operations in Egypt, Jordan, Pakistan, Saudi Arabia and the UAE. After pulling out of major markets like China and selling its business in Southeast Asia to Grab last March, Uber has been seeking new avenues of growth.
“This is an important moment for Uber as we continue to expand the strength of our platform around the world,” Uber CEO Dara Khosrowshahi said in a press release. “With a proven ability to develop innovative local solutions, Careem has played a key role in shaping the future of urban mobility across the Middle East, becoming one of the most successful startups in the region.”
Careem itself has been in the news of late, making its aspirations to evolve into an everyday lifestyle app much more overt. In recent months, Careem expanded into new markets across the region as well as tier two cities. Careem also leveraged the existing infrastructure built out for its ride-hailing service to launch online delivery for goods and services with initial efforts focused on foodservice. It also launched peer-to-peer, closed loop and prepaid credit transfer services to its consumer base. More recently, it introduced a rewards program, giving its 33 million users points on all rides.
“Joining forces with Uber will help us accelerate Careem's purpose of simplifying and improving the lives of people and building an awesome organization that inspires,” Careem’s cofounder and CEO Mudassir Sheikha said in the press release. “The mobility and broader internet opportunity in the region is massive and untapped, and has the potential to leapfrog our region into the digital future.”Read the full article