adithya
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Ola, a cab-hailing app provider backed by SoftBank, on Tuesday announced a deal to buy Foodpanda’s Indian business from its Germany-based parent firm, Delivery Hero Group, in an all-stock deal for an undisclosed amount.
Ola, which will sell its stocks to Delivery Group, will invest $200 million to expand Foodpanda’s Indian footprint, according to a joint statement from the companies. This is “by far the largest such fund infusion into India’s online food ordering and delivery industry so far.”
The online food delivery industry grew at 150% year-on-year with an estimated gross merchandise value of $300 million in 2016, according to India Brand Equity Foundation, a government trust. With online food delivery players like Foodpanda, Zomato, TinyOwl and Swiggy building scale through partnerships, “the organised food business has a huge potential and a promising future.” “Foodpanda has come to be a very efficient and profit-focussed business over the last couple of years,” Bhavish Aggarwal, co-founder and CEO of Ola said. “Our commitment to invest $200 million in Foodpanda India will help the business to be focussed on growth by creating value for customers and partners.”
‘Strategic move’
Niklas Ostberg, CEO and co-founder of Delivery Hero AG, said that the partnership would allow Delivery Hero to further consolidate in markets where it strategically “makes sense to collaborate with leading players.”
Saurabh Kochhar, who was the CEO of Foodpanda India until recently, has decided to move on to pursue other opportunities. Pranay Jivrajka, founding partner at Ola, has been appointed as interim CEO of this business unit, supported by the existing leadership team at Foodpanda India, according to the joint statement.
Ola had earlier entered the food delivery business in 2014 with Ola Cafe, which was shut down. The firm’s rival Uber made its foray into the segment with UberEATS recently. Companies such as Swiggy, Zomato are already in the fray.
“The company had its learnings with the closure of Ola Cafe about three-and-half years ago,” a source close to Ola said. “At that point of time, Ola decided to concentrate on its core mobility platform. Now, from an experimental stage, the company has gone to an investment stage with the acquisition. Fundamentally, both food delivery and cabs belong to the same segment of logistics. With Ola’s stage and reach they will be able to leverage both.”
Ola buys Foodpanda’s India business - BUSINESS - The Hindu
Ola, which will sell its stocks to Delivery Group, will invest $200 million to expand Foodpanda’s Indian footprint, according to a joint statement from the companies. This is “by far the largest such fund infusion into India’s online food ordering and delivery industry so far.”
The online food delivery industry grew at 150% year-on-year with an estimated gross merchandise value of $300 million in 2016, according to India Brand Equity Foundation, a government trust. With online food delivery players like Foodpanda, Zomato, TinyOwl and Swiggy building scale through partnerships, “the organised food business has a huge potential and a promising future.” “Foodpanda has come to be a very efficient and profit-focussed business over the last couple of years,” Bhavish Aggarwal, co-founder and CEO of Ola said. “Our commitment to invest $200 million in Foodpanda India will help the business to be focussed on growth by creating value for customers and partners.”
‘Strategic move’
Niklas Ostberg, CEO and co-founder of Delivery Hero AG, said that the partnership would allow Delivery Hero to further consolidate in markets where it strategically “makes sense to collaborate with leading players.”
Saurabh Kochhar, who was the CEO of Foodpanda India until recently, has decided to move on to pursue other opportunities. Pranay Jivrajka, founding partner at Ola, has been appointed as interim CEO of this business unit, supported by the existing leadership team at Foodpanda India, according to the joint statement.
Ola had earlier entered the food delivery business in 2014 with Ola Cafe, which was shut down. The firm’s rival Uber made its foray into the segment with UberEATS recently. Companies such as Swiggy, Zomato are already in the fray.
“The company had its learnings with the closure of Ola Cafe about three-and-half years ago,” a source close to Ola said. “At that point of time, Ola decided to concentrate on its core mobility platform. Now, from an experimental stage, the company has gone to an investment stage with the acquisition. Fundamentally, both food delivery and cabs belong to the same segment of logistics. With Ola’s stage and reach they will be able to leverage both.”
Ola buys Foodpanda’s India business - BUSINESS - The Hindu
