Online cab aggregator Ola is entering the food delivery space after it announced a deal to acquire Foodpanda’s India business from its parent company DeliveryHero for an undisclosed sum. Ola said it is committing an investment of $200 million into the food delivery business.
This deal includes the transfer of Foodpanda’s India business to Ola in an acquisition deal in exchange for Ola stock.
DeliveryHero acquired Foodpanda from Rocket Internet at the end of last year, primarily to extend its food-ordering business into Asia, the Middle East and parts of Eastern Europe.
Saurabh Kochhar, who headed Foodpanda India, has “decided to move on to pursue other opportunities,” according to to the company’s announcement. Ola founding partner Pranay Jivrajka will interim CEO until a permanent replacement is found. He will be working with the existing management of Foodpanda India.
“The partnership with Ola will allow us to further consolidate markets where it strategically makes sense to collaborate with leading local players. At the same time, we consider our stake in Ola as a very valuable asset, while Ola’s investment commitment in Foodpanda India is a clear and confident signal to the Indian market,” said Niklas Ostberg, CEO and co-founder of Delivery Here AG.
“As one of India’s pioneers in the food delivery space, Foodpanda has come to be a very efficient and profit-focused business over the last couple of years. Our commitment to invest $200 million in Foodpanda India will help the business be focused on growth by creating value for customers and partners. With Delivery Hero’s global leadership and Ola’s platform capabilities with unique local insights, this partnership is born out of strength. I look forward to welcoming the Foodpanda India team to the Ola family,” said Bhavish Aggarwal, co-founder and CEO, Ola.