Uber to Buy Food Delivery Service Postmates for Nearly $2.65 Billion
While Uber's ride-sharing service has seen a decline in the wake of the coronavirus outbreak, bookings on its meal delivery platform are up more than 100 percent over last year, according to the company
Uber is expanding its food delivery service empire.
The ride-share company, which also operates Uber Eats, announced on Monday that the company will acquire delivery platform Postmates for approximately $2.65 billion in an all-stock transaction.
Uber estimates that it will issue approximately 84 million shares of common stock for 100 percent of Postmates' fully diluted equity, according to a press release.
Though Uber intends to keep Postmates running as a separate app, the acquisition will give consumers access to an expanded selection of restaurants and merchants from both companies while enabling them to streamline its joint network of couriers.
“Uber and Postmates have long shared a belief that platforms like ours can power much more than just food delivery—they can be a hugely important part of local commerce and communities, all the more important during crises like COVID-19," Uber CEO Dara Khosrowshahi said in a statement. "We’re thrilled to welcome Postmates to the Uber family as we innovate together to deliver better experiences for consumers, delivery people, and merchants across the country."
Bastian Lehmann, Postmates co-founder and CEO, added in a statement, “Over the past eight years we have been focused on a single mission: enable anyone to have anything delivered to them on-demand. Joining forces with Uber will continue that mission as we continue to build Postmates while creating an even stronger platform that brings this mission to life for our customers."
"Uber and Postmates have been strong allies working together to advocate and create the best practices across our industry, especially for our couriers. Together we can ensure that as our industry continues to grow, it will do so for the benefit of everyone in the communities we serve," the statement read.
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While Uber's ride-sharing service has seen a decline in the wake of the coronavirus outbreak, bookings on its meal delivery platform — which was launched in 2014 — are up more than 100 percent over last year, the company said.
Currently, Uber Eats is the second most widely used food delivery platform in the United States, sitting behind the on-demand delivery app DoorDash, according to data from analytics firm Second Measure.
Uber's acquisition of Postmates comes almost a month after Just Eat Takeaway.com announced plans to merge with GrubHub, a food delivery service the ride-share platform had previously been eyeing, the Associated Press reported.
“Like ridesharing, the food delivery industry will need consolidation in order to reach its full potential for consumers and restaurants," Uber said in a statement at the time, per AP. "That doesn’t mean we are interested in doing any deal, at any price, with any player."