Chennai: Indian restaurant search and discovery service Zomato has reportedly sold its food delivery business in the United Arab Emirates (UAE) to Delivery Hero Group for around $172 million.
In a statement, the German food delivery firm announced yesterday it has entered into an agreement with Zomato Media to buy its business via Delivery Hero’s fully owned subsidiary Talabat Middle East Internet Services Company LLC.
“The acquisition will add 1.2 million monthly orders and $2 million monthly revenue to Delivery Hero’s Far East and North Africa business and will strengthen its leadership position in the UAE. The acquisition will be fully funded by an acquisition facility,” the company said in a statement.
The company did not mention the exact amount it has spent to buy Zomato’s UAE business. Moreover, Delivery Hero will participate in Zomato’s latest funding round by investing $50 million in Zomato’s global business.
According to sources, Zomato, which is hoping to raise close to $1 billion over the next few months to fuel its fight against Swiggy, has also raised closed to $105 million from Delivery Hero, Glade Brook Capital, Shunwei Capital, and Saturn Shine.
“I am delighted to welcome Delivery Hero as a partner and shareholder and look forward to learning from their global experience to help us strengthen our fast growing India food delivery business,” Deepinder Goyal, CEO of Zomato, commented.
This move will make the Berlin-based firm one of the top 10 shareholders in Zomato. Delivery Hero will also enter into a material operational partnership agreement. According to reports, the company might play an active role in Zomato’s India operations.
“The acquisition will allow us to further improve our service to customers in the UAE. We are also excited to become a shareholder in Zomato’s rapid food delivery growth story in India and share our learnings,” chief executive officer, Delivery Hero, Niklas Östberg, said.
Recently, the Gurugram-based food tech giant elevated Gaurav Gupta as co-founder at a time when it is on the brink of raising a $750 million round from investors, including tech giant Alibaba, Delivery Hero, and others, sources said.