Following the sale of Uber’s 7.8% interest in Zomato for more than $390 million, the Deepinder Goyal-run business said on Wednesday that it was unaware of what its shareholders were doing with their shares. In the first half of this year, Uber did lose over $707 million on its lending in Zomato.
According to a source with knowledge of the situation, Uber reported $2.6 billion in losses for the quarter, of which $1.7 billion came from investments and a reevaluation of its shares in Zomato, Aurora, and Grab.
Uber sold its stake in the online food supplier through a block trade on stock exchanges that were purchased by multiple international and Indian VCs. According to the business, this was a portion of its unrealized gain on investments. According to Uber, their stock share in Zomato was worth $0.4 billion.
Uber presently owns 7.78% of Zomato and in 2020 sold UberEats in India to Zomato in an all-stock deal for a 9.99% interest. Uber owns over 612 million (61.12 crores) shares of Zomato.
Indian Food Delivery Company By Uber Sold To Zomato
After years of aggressively competing for market share with local food goliaths Zomato and Swiggy, Uber sold its Indian food delivery company to rival Zomato for $206 million.
As part of the agreement, Uber bought a 9.99% interest in the Indian food delivery business that is currently losing money. Uber declined to comment right away when contacted.
The company’s market cap on Tuesday was $5.5 billion, much lower than the $13.2 billion valuation it had attained on its first day of trading a year earlier. The stock closed Tuesday at 55.55 Indian rupees (72 cents) per share.
In a statement, Zomato stated that it aimed to achieve EBITDA break-even by the fourth quarter of the following year and that it has reduced its investment in Blinkit, from $400 million to $320 million.
About The Company Zomato
Zomato, a food delivery service based in Gurgaon and the first consumer tech startup in India to go public, saw its shares close up 65% on the first day of trading in Mumbai, providing important insight into the appetite investors have for the burgeoning startup ecosystem in the second-largest internet market in the world.
Zomato’s shares rose as high as 138.9 Indian rupees ($1.87) during the course of the day, trading above the issue price of 76 Indian rupees ($1).
40 times more people subscribed to the startup’s $1.3 billion first public offering last time. As part of the agreement, Uber bought a 9.99% interest in the Indian food delivery business that is currently losing money.
This demonstrates that we can produce sizable IPOs, which increases the appeal of our firms to international LPs.
Uber reported unrealized losses of $1.1 billion on its Aurora investment during the quarter, $520 million on Grab, and $1.4 billion. After its consolidated loss for the quarter ending in June virtually halved year over year to Rs 186 crore, its shares increased by close to 20% in August.
Additionally, Uber discussed selling its ride-hailing company in India, but those conversations were eventually put on hold. There was “zero truth” to it, according to Uber CEO Dara Khosrowshahi, and it wasn’t researched or taken into account.