Home PC News Uber confirms $2.7 billion Postmates acquisition

Uber confirms $2.7 billion Postmates acquisition

Uber has confirmed that it’s shopping for on-demand supply firm Postmates in an all-stock deal valued at $2.65 billion. The announcement comes after per week of intense speculation, which culminated in Bloomberg reporting earlier at the moment that the deal was carried out, although neither firm had responded to the claims till now.

According to Uber, the acquisition will likely be leveraged for each Uber’s burgeoning meals supply enterprise, Uber Eats, in addition to its broader “delivery-as-a-service” push which has seen Uber more and more ship all method of products together with groceries. Furthermore, as soon as the acquisition closes, Uber mentioned that the consumer-facing Postmates app will likely be maintained as a standalone entity, although retailers and clients will profit from a mixed supply community.

Uber isn’t any stranger to strategic acquisitions, having lately closed its $3.1 billion acquisition of Middle Eastern ride-hail rival Careem and bought a controlling stake in Latin American grocery supply startup Cornershop. On the flipside, Uber has additionally divested a variety of its native companies to more-established rivals in Eastern Europe, China, and Southeast Asia.

Non-IPO

Postmates had been a hotly anticipated IPO candidate for 2020 having initially filed its paperwork confidentially with the Securities and Exchange Commission (SEC) final yr, however the San Francisco-based firm shelved these plans because of a lukewarm response from buyers. However, Postmates was reportedly getting ready to revive these plans as quickly as this week, maybe giving a better diploma of urgency to Uber’s push to consolidate the fiercely aggressive meals supply market.

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Founded in 2011, Postmates emerged as one of many predominant gamers within the on-demand meals supply sphere, partnering with eating places and different eateries to present them quick access to a smartphone-based supply community. Although the platform is maybe higher identified for delivering meals, in actuality it can be used to courier just about any item between a service provider and the customer. This is just about much like how Uber has developed too, beginning out because the logistics infrastructure for taxi-like transport companies, earlier than reappropriating the know-how for Uber Eats, which the corporate introduced at the moment has skilled a 100% year-on-year improve in bookings throughout Q2 2020. A number of months again, Uber additionally unveiled a brand new service referred to as Uber Connect, which repositions its platform as a courier service — folks can use it to move nearly any items from A to B.

Although Postmates briefly flirted with worldwide growth with a Mexico launch again in 2017, the platform is now completely accessible to U.S. shoppers, making this acquisition a purely home play by Uber. Indeed, Uber has been pushing to consolidate the U.S. meals supply marketplace for a while, having reportedly mulled a merger with Postmates’ rival DoorDash final yr — as a substitute, DoorDash confidentially filed for an IPO earlier this yr, earlier than going on to raise another $400 million whereas concurrently inserting a query mark over the timescale for its plans to go public. Uber additionally pursued meals supply juggernaut Grubhub, which was ultimately snapped up by European rival Just Eat in a $7.Three billion deal again in June.

Having failed to obtain market chief DoorDash and Grubhub, it is smart that Postmates could be subsequent in line for Uber’s M&A group. According to shopper information analytics agency Second Measure, Postmates had 8% of the U.S. meals supply market in May, behind Uber Eats (22%), GrubHub (23%), and DoorDash (45%). Based on that information, Uber will now be the clear second greatest participant within the home meals supply market.

Uber mentioned that it’s going to challenge round 84 million shares of widespread inventory for 100% possession in Postmates.

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