Uber Technologies, the ride-hailing company, is reportedly in early-stage talks with Careem Networks, the Middle East-based ride-hailing company, to combine operations or for Uber to buy the company outright.
Bloomberg, citing three people familiar with the matter, reported that the aim is to put an end to a rivalry in the Middle East that has been costly to both companies. The two sides have held talks about several different deal structures but haven’t reached an agreement, Bloomberg reported. This wouldn’t be a surprising move for Uber, which has unloaded businesses in Southeast Asia, Russia and China. The company has said it was finished selling its global business units separately. People familiar with the talks told Bloomberg that in any deal with Careem, Uber would have to own more than half of the company if not acquire Careem outright. A spokeswoman at Careem declined to comment on the report but told Bloomberg that its expansion plans are “only getting started.”
Bloomberg reported that under one structure that was discussed Careem’s executives would run the combined business and that one or both of the local brands would continue to operate. In another idea, Uber would buy Careem. Talks may not result in the companies reaching a deal, noted Bloomberg.
At the same time that Uber and Careem are holding talks, Careem is aiming to raise $500 million from investors. That could give the company a valuation of around $1.5 billion. It also reportedly talked to investment banks about an initial public offering in January, noted the report. Careem is in 70 cities in 10 countries including North Africa and Pakistan. In the areas it operates it is mainly the leader, with Saudi Arabia its largest market. Uber is gearing up to sign up women drivers in that country to capitalize on the decision to overturn the ban on driving by females, noted Bloomberg.