Selling food biz in India to Zomato delivers $154 Mn pre-tax gains for Uber

Ride-hailing major Uber has announced its financial results for the quarter ended March 31 and it shows a pre-tax gain of $154 million posts the sale of Uber Eats’ India business to online food delivery major Zomato. 

To recall, Zomato acquired Uber Eats India in an all-stock transaction for $206 million in January this year. The deal also gave Uber 9.99% ownership in Zomato. While the investment was valued at $171 million, the remaining $35 million was received as a reimbursement of goods and services tax receivable from Zomato.

On a pre-tax gain of $154 Million, Uber Eats India’s other transactions and related costs amounted to around $10 million, a company statement said. 

The overall revenue of Uber rose 14% year-on-year to $3.54 billion in the quarter ended March. The company, however, posted a loss of $2.9 billion during the same period which included a $2.1 billion pre-tax write-down of the value of some of its minority investments. 

India’s revenue and loss figures were not mentioned in the statement.

Commenting on the company’s performance during these 3 months, Uber CEO Dara Khosrowshahi said, “While our rides business has been hit hard by the ongoing pandemic, we have taken quick action to preserve the strength of our balance sheet, focus additional resources on Uber Eats, and prepare us for any recovery scenario.”

Uber had resumed its operations in 31 Indian cities after the government allowed cab-hailing apps and taxis to operate from May 4 in green and orange zones. Whereas its rival Ola has started operating across 100 cities. Their operations were on halt due to the nationwide lockdown which began on March 24. 

This also comes in the backdrop of Uber being in the process of letting go of around 500-700 employees from its India office in the next two weeks. Entrackr had exclusively reported the development.