Egypt renews state of emergency for three months: Official gazette    Manchester United's Solskjaer concedes City have set a new standard    Guardiola amazed by Manchester City's response to European exit    Manchester City's Fernandinho facing knee injury scan    Egyptians binging on holiday    Delivering results    Partial sale of Banque du Caire    Understanding Sudan    It's not the end until it's the end    After the Sri Lanka bombings    The return of the vice president    Expat voices heard    In pursuit of stability    Sliced twice    Egyptian triple    Staged in Cairo    Steel troubles    Primary healthcare for all    Avengers: Endgame    Celebrating World Heritage    Don't miss "The Sum of All Parts" exhibition at UBUNTU gallery    "The Golden Era: Egypt in the World Cup" photography show at AUC is a must go    Egypt's constitutional amendments approved: What's next?    Egypt's state employees to be assessed ahead of transfer to New Administrative Capital    Centamin reports better-than-expected Q1 gold output    Egypt to set up 4 medical centers in Africa: Minister    Republished: Good morning, Sinai: A look at the headlines when Israel withdrew in 1982    AU countries asks to extend transitional period in Sudan to 3 months    Upper Egypt pipelines receive 7.5m tonnes of fuel annually: PPC    Egyptian voters back constitutional amendments    Nasr asserts EGX role in helping companies grow    Petroleum Ministry establishes $2.3bn oil refining projects in Assiut    Thousands of Moroccans demand release of 42 Hirak Rif activists    Security, confronting terrorism are common challenges facing Egypt, African continent: Ramdan Orny    Figurative Encounters: Exhibition Haphazardly Crosses Space, Time    Ministry of Culture mourns Bachir El-Sebaie    Russia eases citizenship rules in east Ukraine    Sri Lankan president asks police chief, defence minister to quit following attacks    Elders, campaigners dominate scene in Kerdasa polling stations    250 archaeological missions from 25 countries work in Egypt: Minister    Spring Affair Returns for Second Season of Shopping, Charity    Tod's bring back Alber Elbaz to Fashion Scene    Bundesliga: Bayern Munich turn the screw in a reminder of champions past    The main differences between Catholics and Protestants    Karlovy Vary to honour cinematographer Vladmir Smutny    Trade exchange between Egypt, Tunisia to increase to $500m    Cairo Copts celebrate Palm Sunday    Vatican willing to offer technical know-how to help restore Notre-Dame    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.





Uber buys rival Careem in $3.1 billion deal to dominate ride-hailing in Middle East
Published in Ahram Online on 26 - 03 - 2019

Global ride-hailing firm Uber Technologies Inc will spend $3.1 billion to acquire Middle East rival Careem, buying dominance in a competitive region ahead of a hotly anticipated initial public offering.
Uber said late Monday night it would pay $1.4 billion in cash and $1.7 billion in convertible notes in a deal that gives it full ownership of Careem. The long-expected agreement ends more than nine months of start-and-stop negotiations between the two companies and hands Uber a much-needed victory after a series of overseas divestments.
The notes will be convertible into Uber shares at a price equal to $55 apiece, Uber said, marking about a nearly 13 percent increase over Uber's share price in its last financing round, led by SoftBank Group Corp more than a year ago.
The acquisition makes Careem a wholly owned subsidiary of Uber and will keep the Careem brand and app intact, at least initially. Careem co-founders Mudassir Sheikha, Magnus Olsson and Abdulla Elyas are staying on with Careem following the acquisition, the companies said.
However, Careem's board will be overhauled, with three seats going to Uber representatives and two belonging to Careem. Sheikha, who is Careem's CEO, and Olsson will have board seats. An Uber spokesman declined to say whom Uber would appoint to the board.
The $3.1 billion cash-and-stock purchase buys out all outside Careem investors, the companies said, and Careem stock will be converted into Uber equity. Careem had raised less than $800 million from investors and as of October had a $2 billion valuation. Its backers include German car maker Daimler AG , Chinese ride-hailing company Didi Chuxing, Japanese internet company Rakuten Inc and Saudi investor Kingdom Holding Company.
The deal is expected to close in the first quarter of 2020, the companies said, meaning it will not be reflected in Uber's first couple of quarterly earnings releases as a public company, although it will likely be disclosed in a public IPO filing. Uber will kick of its IPO next month and is expected to receive a valuation of at least $100 billion.
The agreement is subject to regulatory approval, including by antitrust officials in the countries where Careem operates, which could prevent the deal from moving forward or compel the companies to modify the terms.
MONTHS OF NEGOTIATIONS
The deal is particularly important for Uber, whose ability to be a competitive global ride-hailing player had come into question after it sold its operations in China, Russia and Southeast Asia to local rivals after sustaining heavy losses.
Uber Chief Executive Dara Khosrowshahi in a statement called the deal with Careem “an important moment for Uber.”
Uber has been eager to reach an agreement before the company begins its “roadshow,” when it will meet with public market investors prior to listing shares on the New York Stock Exchange. The deal enables Uber to claim dominance in a growing region for ride-hailing outside of the United States.
Uber operates in more than 70 countries, but faces strong rivals in Latin America and India, and tough regulations in Europe.
Talks between the companies had dragged on since at least last summer, sources told Reuters, although they did not get serious until the end of the year. The companies had for years battled in a competition for drivers and riders that had required discounts and subsidies and pushed prices artificially low.
Careem over the course of last year grew its business rapidly, including adding a delivery service, and went on to nearly double its valuation, pressuring Uber to increase its bidding price.
Toward the end of last year, Careem was entertaining interest from investors for another financing round when Uber moved aggressively to buy the company outright, sources said.
SPOTLIGHT ON MIDDLE EAST TECH
Careem, founded in 2012, has a larger presence than Uber in the Middle East, North Africa, Pakistan, and Turkey, operating in 98 cities there compared with Uber's roughly 23 locations.
“An Uber-Careem merger underscores the huge potential of car-hailing in the Middle East,” said Sam Blatteis, CEO at the MENA Catalysts, a Middle East public policy advisory and research firm.
The merger also follows the $580 million acquisition of Dubai-based ecommerce company Souq Group Ltd by Amazon.com Inc in 2017, according to a U.S. Securities and Exchange Commission filing, spotlighting the Middle East's budding technology scene.
“It's the first ‘unicorn' exit in the Middle East, and it's representative of things to come out of the Middle East,” said David Chao, co-founder and general partner at venture firm DCM and a Careem investor, referring to start-ups valued at $1 billion or more.
Uber said its revenue last year was $11.3 billion, while its gross bookings from rides were $50 billion. But the company lost a staggering $3.3 billion, excluding gains from the sale of its overseas business units in Russia and Southeast Asia.
Careem does not disclose its earnings.


Clic here to read the story from its source.