Uber might have just made the largest tech deal in Middle East history. The car-hailing company has spent $3.1 billion to dominate the competition in the Middle East.
On Tuesday, 26th March 2019, Uber announced it reached an agreement to buy Dubai-based company Careem. The company dominated the Middle East with its operation in 15 countries. They include the UAE, Jordan, Morocco, Pakistan, Egypt, and Saudi Arabia.
The deal was reportedly worth $1.4 million in cash and $1.7 billion in loans. This deal is huge and acclaimed one of the biggest tech industry deals in the region.
On Careem’s website, the company said it still identifies as Careem. However, the new deal would mean the company will operate on its own but with its two co-founders under Uber.
Uber started operating in the Middle East in late 2013, the same year Careem was founded. They have both been competitors since.
Experts believe that this new acquisition will kill local transit competition. They think that Uber will effectively monopolise the ride-hailing market in the region.
In 2018, Uber sold its business in Southeast Asia to a local competition, Grab. It inadeptly pulled out of the region after this move.
The CEO of Uber, Dara Khosrowshahi, in an email to employees said the new framework has the advantage of letting the company build new products and also try new ideas together as a team. He confirmed that they were keeping Careem as an independent entity.
The Iranian-American businessman said they will eventually integrate and bring on new products that Careem offers.
With a potential record evaluation of $120 billion, Uber may go public in April 2019. Uber’s competitor in the United States and Canada, Lyft has also filed to go public. Lyft may list its IPO on 29th March 2019.