Delivery Hero, a food delivery brand based in Berlin, announced the acquisition of Zomato’s UAE business. Zomato is a restaurant discovery and food delivery platform based in Gurugram.
The acquisition will lead to the addition of 1.2 million orders every month to Delivery Hero’s business operations. Monthly, the Berlin firm will generate US$ 2 million more revenue.
The addition of Zomato’s UAE operations will add more business and strength to the North African and Middle East regional business of Delivery Hero.
Delivery Hero operates in 41 countries located in the Middle East, North Africa, Asia-Pacific, Latin America, and Europe. It is currently providing service in more than 200 cities across the world. Previously, its investment in Foodpanda was sold to acquire 1% stake in Ola back in 2017.
CEO of Delivery Hero, Niklas Östberg said, “Zomato has built a successful food delivery business in the UAE and India on the back of its restaurant search and discovery app and website. 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.”
Zomato did not respond with a comment when inquired about the acquisition.
In addition to the acquisition, Delivery Hero is all set to become a part of the funding round. It wants to invest US$ 50 Million in the global business operations of Zomato. It has shown interest to become a top-10 Zomato shareholder. The brand has also shown interest in entering a partnership for material operations.
CEO and co-founder of Zomato, Deepinder Goyal said, “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.”
The speculations of the acquisition came forth in January this year. It was thought that Zomato might have sold its business for US$ 250 Million to stay in the competition with Swiggy in India.
It entered the UAE in 2012. Soon enough, 20% of all its orders came from this region. It also launched its premium service named Zomato Gold here in 2017. It managed to attract 15,000 members and 380 restaurant partners within a year.
Also Read: Zomato scales the revenues by 40 percent
Zomato is facing a tough rivalry from Swiggy, a Bengaluru-based food delivery platform. Swiggy joined the unicorn club by attracting over US$ 1 Billion funds in 2018. Zomato challenged to regain its stronghold. It recorded a whopping 40% growth in revenue and targeted to raise funding up to US$ 1 Billion.