Uber Technologies Inc. settled to attain the Dubai-based ride service Careem for $3.1 Billion. Uber is already operating in Dubai; however, together with Careem, it is expanding its company in the Middle East.
Uber’s decision to obtain Careem comes prior to its awaited initial public offering. Reports estimate that Uber could now be valued at about $120 Billion.
After acquiring Careem, Uber will take control of operations in the Middle East, with chief markets including Egypt, Jordan, Pakistan, Saudi Arabia, and the UAE.
“This is an important moment for Uber as we continue to expand the strength of our platform around the world. With a proven ability to develop innovative local solutions, Careem has played a key role in shaping the future of urban mobility across the Middle East, becoming one of the most successful startups in the region. Working closely with Careem’s founders, I’m confident we will deliver exceptional outcomes for riders, drivers, and cities, in this fast-moving part of the world,” Dara Khosrowshahi stated, Uber Chief Executive Officer.
This decision could also be to reinforce Uber’s financials following the reported loss of $1.8 Billion in 2018.
Now, acquiring Careem will ascertain Uber as a leading ride service within the Middle East while adding numerous other services under its portfolio as well, including Careem’s digital payment platform, Careem Pay, and Careem NOW.
Uber stated that it doesn’t expect the attainment to close until about Q1 2020. Till then, both companies will work independently.
Uber’s attainment of Careem follows right after Lyft released initial public offering filings. It announced that it raised $2 Billion in its IPO launch, valuing the Company at about $23 Billion. But relative to Uber, Lyft is considerably smaller.
Uber (unlike Lyft), extended its business by addition of numerous services e.g. Uber Eats. Uber has also gotten into the tech division by developing autonomous driving services and its concept services e.g. drones.
Lyft appears to be more put on the ride service as of now; however, Uber is aiming to further integrate itself into the field of tech. Nonetheless, they both still dominate the ride service scene in the U.S., accounting for a total of 40% of the U.S. market share.