Country’s leading mobility platform, Ola, today announced the acquisition of Foodpanda’s India business from Germany based Delivery Hero Group (“Delivery Hero”), the leading global online food ordering and delivery marketplace. The acquisition comes nearly seven months after US-based ride-hailing firm Uber Technologies Inc launched UberEats in India.
Ola did not divulge details about the number of shares sold, but sources have pegged that the deal is likely to have valued the food delivery venture at under $50 million. Further, Ola has also committed investments of $200 million in the Foodpanda India business to take on its rivals such as UberEats Zomato and Swiggy.
Commenting on the deal Bhavish Aggarwal, Co-founder and CEO at Ola, said, “I’m excited about our partnership with Delivery Hero as we team up to take Foodpanda India to the next level. As one of India’s pioneers in the food delivery space, Foodpanda has come to be a very efficient and profit focused business over the last couple of years. Our commitment to invest $200mn in Foodpanda India will help the business to be focused on growth by creating value for customers and partners.”
With this new development, Ola’s Founding Partner Pranay Jivrajka has taken over as interim CEO of this business unit, supported by the existing leadership team at Foodpanda India, while Saurabh Kochhar, who was the CEO of Foodpanda India until recently has decided to move on to pursue other opportunities.
Foodpanda currently operates across 100+ cities in India with menus from over 15,000 restaurants. The company was able to narrow down its losses in the year ended March—to Rs 44.81 crore from Rs 142.64 crore a year ago. For FY17, it reported a 6% growth in revenues at Rs 62.16 crore from Rs 37.81 crore in the previous year.
Niklas Östberg, Chief Executive Officer and Co-founder of Delivery Hero AG, said, “The partnership with Ola will allow us to further consolidate markets where it strategically makes sense to collaborate with leading local players. At the same time, we consider our stake in Ola as a very valuable asset, while Ola’s investment commitment in Foodpanda India is a clear and confident signal to the Indian market.” He added, “The Foodpanda India team has done a tremendous job building the business and we look forward to supporting them and the Ola team in the future.”
Foodpanda India will benefit from Ola’s scale and efficiencies as a platform, also having leveraged learnings from Delivery Hero’s best global practices. However, only time will tell how Ola and Delivery Hero will continue to collaborate on building the online food delivery ecosystem in India.