Uber set to buy rival Careem for $3 billion

Islamabad (Pakistan Point News – 25th March, 2019) Ride sharing firm Uber Technologies Inc. is set to announce a $3.1 billion cash-and-share deal to acquire its Dubai-based rival Careem Networks FZ as early as this week.

According to reports in international media, US ride-hailing giant Uber will pay $1.4 billion in cash and $1.7 billion in convertible notes for Careem.

The notes will be convertible into Uber shares at a price equal to $55 per share.

Shareholders in Careem, whose backers include Saudi Prince Alwaleed bin Talal’s investment firm and Japanese e-commerce company Rakuten Inc., have been asked to agree to the terms of the transaction by Monday evening and a deal could be announced as soon as Tuesday, a Bloomberg report said.

Uber’s acquisition of Careem would come ahead of its imminent initial public offering, which could be one of the New York Stock Exchange’s biggest-ever listings.

Dubai-based Careem boasts more than a million drivers and 30 million users across 90 cities.

For Uber, a deal would signal its commitment to the middle East, where one of its biggest investors – a Saudi Arabian sovereign wealth fund – is based.

The acquisition would also be a departure in strategy for Uber, which has used such deals to offload costly overseas operations in exchange for stakes in competitors in the past.