Uber Acquires Postmate: What Does That Mean?
Speaking of business, rare things may be considered more challenging than operating a successful local eatery. National consolidation of banks implies that there are limited lenders ready to give loans to local eateries. The most favorable locales are owned by publicly traded real estate trusts eager for renting only to nationwide chains capable of paying the greatest rents. The top 3 credit card firms take away 3% off every check. The top 4 order-and-delivery applications catch hold of anywhere between 15% and 40% of every order.
Merging and acquiring in the world-wide food delivery market has been gaining momentum. The merger of Uber Technologies Inc. (Uber) and Postmates is a recent advancement in this section. Uber is acquiring Postmates for a whopping $2.65 billion (approx.) in an all-stock agreement. This agreement will join Uber’s worldwide Rides and Eats program with Postmates’ particular delivery service in the United States. The contract is probable to be finalized within the first four months of 2021.
In a statement declaring the contract, Uber announced it “intends to keep the consumer-facing Postmates app running separately” even post the closing of the transaction. The firm confirmed that it also has on the cards to integrate back-end operations and slash $200 million in maintenance costs.
Postmates is in the list of top 4 U.S. food delivery services and the second by market share next to only DoorDash, as noted by Second Measure and Edison Trends. At the present level, DoorDash owns around 44% of the U.S. food delivery scenario while Uber Eats controlled around 23% share prior to the Postmates contract. This clarifies the reason for Uber’s pressing need for the transaction.
Postmates’ model of business complements the one of Uber Eats. Uber also suggested that Postmates has existed as an early bird of “delivery-as-a-service,” which conforms to Uber’s endeavors in the delivery of groceries, essentials and other goods. On July 7th, Uber expanded its delivery services even further, inaugurating an app-based grocery service in various South American and Canadian towns, and the United States is set to join the list by late July.