By UPI |
Uber buys Middle East rival Careem in $3.1 billion deal
March 26 (UPI) -- Uber said Tuesday it's buying Middle East rival Careem for more than $3 billion, ahead of its anticipated stock offering and a labor strike in Southern California.
Dubai-based Careem has about 30 million registered users and operates in North Africa, the Middle East and South Asia. The $3.1 billion deal solidifies Uber's presence in the Middle East while retreating in China and Southeast Asia.
"This is an important moment for Uber as we continue to expand the strength of our platform around the world," Uber CEO Dara Khosrowshahi said in a statement. "Careem has played a key role in shaping the future of urban mobility across the Middle East."
The deal consists of $1.7 billion in convertible notes and $1.4 billion in cash, Uber said. The ride-share company said it plans to close the deal by early next year.
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"Joining forces with Uber will help us accelerate Careem's purpose of simplifying and improving the lives of people, and building an awesome organization that inspires," Careem co-founder Mudassir Sheikha said in a statement.
"The mobility and broader internet opportunity in the region is massive and untapped, and has the potential to leapfrog our region into the digital future."
Uber said last week its public shares will trade on the New York Stock Exchange after an initial public offering, expected next month. It could be valued as much as $120 billion.
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The deal was announced as Uber drivers joined rival Lyft drivers in Southern California for a daylong strike Monday to protest a roughly 25 percent cut in pay for Uber drivers, who were notified this month their per-mile rate was slashed from 80 cents to 60 cents.
"We're doing everything we can to let Uber know that they can't be doing this to us -- we need fair wages," driver Luis Vasquez told Forbes. "Uber keeps hiring more and more drivers, who don't know the system yet, and are easier to take advantage of."
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