The ride-hailing app Uber, which also operates as a food delivery company UberEats will acquire Postmates for $2.65 billion (approx €2.34 billion) in an all-stock transaction, after all the struggle to buy out Grubhub tanked previously.
Plans to close deal in Q1 2021
This acquisition could boost Uber’s delivery business and help compensate the company’s core ride-hailing business, which has plummeted due to the COVID-19 pandemic. Notably, the San-Francisco-based company reported $2.9 billion (approx €2.6 billion) loss in the first quarter of 2020. The company is planning to close the deal in Q1 2021. Post the acquisition, Postmates app will continue to run separately but with a more efficient, combined merchant, and delivery network.
Uber CEO Dara Khosrowshahi, said, “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. As more people and more restaurants have come to use our services, Q2 bookings on Uber Eats are up more than 100 percent year on year. 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.”
Soaring demand for online food delivery
According to Uber, consumers will benefit from expanded choice across a wider range of restaurants and other merchants. For restaurants and merchants, Postmates and Uber Eats will together offer more tools and technology to more easily and cost-effectively connect with a bigger consumer base.
Even though the company is not profitable, the demand has soared since mid-March, with 89% YoY gross bookings growth in April. On the other hand, Uber Eats is shutting down its business in unprofitable markets.
60,000 restaurants and retailers, 50 states
Founded by Bastian Lehmann, Sam Street, Sean Plaice in 2011, Postmates led the creation of on-demand delivery in the U.S and has grown to be the number one platform in Los Angeles.
Right now, the platform operates in all 50 states and offers customers access to the most selection of merchants in the US with more than 600,000 restaurants and retailers available for delivery and pickup, many of which are exclusive to Postmates.
“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,” said Postmates Co-Founder and CEO Bastian Lehmann.
Main image credits: rafapress/Shutterstock
