Uber has acquired online food delivery service Postmates for $2.65 billion in an all stock deal. Postmate’s acquisition places ride-hailing company Uber, at the number two spot in Food delivery in the US. According to Bloomberg, the two are expected to break the news early morning in the US.
Uber’s Uber Eats head Pierre-Dimitri Gore-Coty will run Postmates as well as Uber’s food delivery arm, Uber Eats. However, Postmates’ Chief Executive Officer Bastian Lehmann will reportedly remain as well as his team to lead the company as an Uber subsidiary.
Despite the acquisition, Uber’s food delivery business is yet to be number one as DoorDash Inc. still holds large market share. However, Postmates’ strong presence in Los Angeles and the American Southwest will prove handy for Uber Eats.
Postmates pioneered the food delivery business in the US but failed to keep up with the competition leading to its fourth place in the market. Uber’s interest in acquiring more market share led them to GrubHub Inc., ranked as the third largest food deliver company. The failed bid lead Uber to target Postmates, the fourth largest food delivery business in the US.
Bloomberg notes that Uber and Postmates have held acquisition discussions on and off since 2016.