Uber began as a ride-hailing service back in early 2010. Endeavors of brand expansion has led Uber founders to offer more than just transport services, but has also started to work on food delivery services, a branch of the company they referred to as UberEats that was launched back in 2015.
The company has been a subject of many controversies ever since it has started, but that has not got in the way of it becoming an internationally-renowned brand, extending its reach to more than 80 countries around the globe.
As a means to widen coverage and gain more market, Uber made an offer to purchase Grubhub, a food delivery service. However, a bigger offer was made by Just Eat Takeaway.com and was able to acquire Grubhub for $7.3 billion. Now, Uber has set eyes on Postmates, a rather small but popular local food-on-demand delivery service in the United States. Postmates comprises 8% of total sales in the country in terms of meal delivery.
Uber has officially agreed to purchase all of Postmates’ stocks at $2.65 billion. Following public announcement, Uber’s shares rose 5%. With the ongoing pandemic and people not being allowed to go out of their homes, Uber’s ride-hailing service have experienced a downfall in sales. However, there is a growing demand in meal delivery services at the same time, suggesting that there isn't any time more optimal than now to pursue the venture.
This union will give Uber a huge lead against its biggest competitor, Doordash, which holds 37% of the total market in food delivery. Despite being a local brand, Postmates is actively operational in more than 2,000 cities in the United States, including Los Angeles, Las Vegas, and San Diego. The Uber-Postmates deal is said to be officially closed early 2021, due to delays in regulatory processes because of COVID-19.