Uber & Careem the most talked about news of the day. One of mightiest rivalry in the ride-hailing world has come to its conclusion after numerous rumors made rounds on the internet.
According to the Bloomberg report, Uber Technologies Inc. is set to announce a $3.1 billion cash-and-share deal to acquire its rival and competitor, Careem.
The Dubai-based rival Careem Networks FZ is about handover its acquaintance to Uber as early as this week.
The ride-hailing company, Careem was valued at about $1 billion in 2016 in a funding round. This made it one of the most valuable technology startups in the Middle East at that particular time.
But now Uber has sealed the deal.
To all the people who were unaware of the massive deal happening between the two giants, here are the juiciest details to it:
$1.4 billion in cash and $1.7 Billion in Convertible Notes; Sealing the Deal:
According to the latest reports the U.S based ride-hailing service is about to make its biggest move by providing Careem with $1.4 billion in cash and $1.7 billion in convertible notes. This talk has been done privately among the two contemporaries.
The Bloomberg got their hands over the term-sheet which said that the notes will be convertible into Uber shares at a price equal to $55 per share.
The Deal Will Announce on Tuesday:
The alleged deal between the two massive companies has been the hottest news these days. But with this detail, the hottest news might be coming to its end.
According to the details, the Saudi Prince Alwaleed bin Talal’s investment firm and Japanese e-commerce company Rakuten Inc. had their prominent shares in the ride-having company, Careem. However, as Uber has approached with their irresistible deal, the two shareholders have been asked to agree on the terms of the transaction by Monday evening. After the two shareholders are done with their world, the deal is likely to be made public on Tuesday.
However when the officials of Careem were approached to show their response on the going rumors then they backed off to respond. On the other hand, Uber spokesman Matt Kallman declined to comment on the topic. Things are pretty private.
Uber is About to Do More Than Just Acquiring Its Rivalry:
If you’re thinking that Uber has taken the biggest business step by acquiring Careem, then you are bit unaware of its power.
Rumors have it that Uber is expected to publicly file for an IPO in April, starting of a listing that could value the company at as much as $120 billion. You heard it right, Uber’s playing big time.
This proves that Uber acquisition of Careem is part of the on-going plan.
What Good Things are Expected After The Acquisition:
The deal is a way to signal Uber commitment to its Middle East people or should I say, investors, as the company’s biggest investors; the Saudi Arabia’s sovereign wealth fund, is based in the Middle East.
Not only this, but the alleged accusation will come as the ultimate welcome boost for Middle East’s nascent technology startup market.