Uber today announced the acquisition of meal delivery service Postmates in an all-stock deal worth $2.65 billion. Uber is expected to run its new acquisition alongside Uber Eats by merging some of the tech and delivery operation, TechCrunch reports.
Postmates Chief Executive Officer Bastian Lehmann will continue to run Postmates with his team as a separate service while Uber Eats Chief Pierre-Dimitri Gore-Coty will stay on to run Uber’s combined delivery business according to Bloomberg.
Uber accelerated talks with Postmates after it had failed in a bid to acquire Grubhub, a fellow competitor which was grabbed by Europe’s Just Eat Takeaway in a $7.3 billion acquisition. With the acquisition of Postmates, Uber will hope to topple DoorDash, the current number one food delivery service in the United States.
In a statement, Postmates CEO and co-founder Bastian Lehman said, “Over the past eight years we have been focused on a single mission: enable anyone to have anything delivered to them on-demand. Joining forces with Uber will continue that mission as we continue to build Postmates while creating an even stronger platform that brings this mission to life for our customers. Uber and Postmates have been strong allies working together to advocate and create the best practices across our industry, especially for our couriers. Together we can ensure that as our industry continues to grow, it will do so for the benefit of everyone in the communities we serve.”
Uber will hope its meal delivery business will help cover some grounds on the losses it’s been having since the COVID-19 outbreak began. With Coronavirus patient numbers increasing in the US day by day, the acquisition of Postmates is coming at a good time.
“Uber and Postmates have long shared a belief that platforms like ours can power much more than just food delivery—they can be a hugely important part of local commerce and communities, all the more important during crises like COVID-19,” explains Uber CEO Dara Khosrowshahi in a statement. As more people and more restaurants have come to use our services, Q2 bookings on Uber Eats are up more than 100% year on year. “We’re thrilled to welcome Postmates to the Uber family as we innovate together to deliver better experiences for consumers, delivery people, and merchants across the country,” said Uber CEO Dara Khosrowshahi in a statement.”
Postmates was founded in the US in 2011 as a mobile app meal delivery service. It has since fallen behind its competitors but it maintains a strong presence in Los Angeles and the American Southwest.