Ola to invest $200 mn in Foodpanda after buyout; company returns to food delivery to take on UberEATS
The deal marks Ola’s return to the food delivery business, which it exited in 2016,
Frankfurt/New Delhi: Germany’s Delivery Hero, an online food ordering and delivery marketplace, is selling its Foodpanda India business to Ola in return for shares in the Indian ride-hailing firm, the companies said on Tuesday.
Under the agreement, Ola, owned by ANI Technologies, will also commit to investing $200 million in Foodpanda’s India business.
The deal marks Ola’s return to the food delivery business, which it exited in 2016, according to local media reports, and will give the company a platform to compete with UberEATS, a similar service launched in May by global ride-hailing rival Uber Technologies.
UberEATS delivers in about half a dozen Indian cities while Foodpanda is present in more than 100 cities. Other online food delivery services include Sequoia Capital-backed Zomato and Swiggy which is backed by Naspers.
“The partnership with Ola will allow us to further consolidate markets where it strategically makes sense to collaborate with leading local players,” Delivery Hero Chief Executive Niklas Ostberg said.
Delivery Hero, which floated on the stock exchange in Germany in June, had acquired food delivery firm foodpanda and its Indian subsidiary in December 2016.
Foodpanda India reported a 64 percent increase in revenue at 621.6 million rupees ($9.7 million) for the fiscal year ended March 31 and losses narrowed to 448.1 million rupees from 1.43 billion rupees in the year-ago period, according to local media reports.
The online food delivery market in India is expected to grow more than six-fold to $750 million this year from about $120 million in 2015, according to a report by consultant RedSeer.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.