Uber to get Postmates at the rate of $2.65 billion: Uber has finally agreed to purchase a food delivery service known as ‘Postmates” at the rate of 42.65 billion. The companies are planning to announce the all-stock deals very soon, said by two persons.
Just like other transportation and travel-related services. Uber’s ride segment has really been affected due to the outbreak of the Coronavirus. Which caused a lot of pandemics and also resulted in the lockdown in all countries. However, services operating online are really making a profit. Because now, people do not leave their homes following the virus outbreak.
What they do now is to order whatever they want or need online. People rely on services online to get their food delivered to them, for instance, “Uber Eats”.
Following the reports from its last earnings, Uber’s ride-hailing gross bookings really went down. However, Uber’s food delivery service, “Uber Eats”, had a gross sales growth of about 54% just during its first fiscal quarter.
Uber planned to buy Grubhub
Following the previous reports made, Uber planned to buy Grubhub, earlier this year (that is, another on-demand delivery service). However, immediately the deal fell, it then made an offer to Postmates.
Though, Bloomberg already gave a report saying that Uber and the food delivery service, Postmates have already talked for close to four years now, but the negotiations between them became deeper about one week ago.
However, Grubhub was acquired by “Just Eat Takeaway” for the sum of $7.3 billion, just after all its negotiations with Uber fell through.
Postmates is sure a very small company compared to Grubhub with its last venture valuation of $2.4 billion in September, last year (2019). The company decided to go public in February, last year, however, due to the “choppy market” conditions, the company decided to stay back.
Postmates to place a public IPO filling with a target valuation of $3.9 billion
A report also came in later, saying that Postmates would be placing a public IPO filling with a fixed valuation of $3.9 billion.
If possibly the deal goes through, the major competitors in the American food delivery market would then be Uber Eats / Postmates versus Grubhub /Takeaway versus DoorDash.
So many companies in other countries have also started creating their own on-demand delivery services in order to cover up all loss from fewer ride-hailing bookings.
For instance, Grab answered the stay-at-home orders in Indonesia (that is, its major market). It also responded to other Southeast Asian countries. By moving and transferring ride-hailing drivers to on-demand deliveries for food and other essential items.
Although, food delivery apps that connect drivers, restaurants, and also customers have grown so rapidly. Fueled by armies of contract workers and also venture capitals.
But the services each of them render are not so different from each other. And this results in high pressure and high competition to make their fees low. Because of this, delivery app companies are now aiming at making deals to gain scale.
In Conclusion: Uber is seriously looking forward to growth. Now that more people stay at home due to the Covid-19 pandemic. Its core ride-hailing business really went down because of the virus outbreak which made everyone stay indoors.
Though, Uber posted a $2.9 billion loss in May for the first three months of the year. The company also announced that it was putting off 14% of its workforce. However, the revenue for its “Uber Eats division” rose to about 53%.