Source: Business Standard, Nov 13, 2019
Bengaluru: Ride-hailing major Uber has infused Rs 1,767 crore in fresh capital into its Indian entity, Uber India Systems Private Limited.
According to the company’s regulatory filings sourced from business intelligence platform Paper.vc, Uber India has allotted 11.12 million equity shares, valuing Rs 10 each at a premium of Rs 1,578.20 to the Netherlands-based entities Uber International Holding BV and Uber International BV.
The board of directors of Uber India passed this resolution at a meeting held on October 29, 2019, the company filing says. This was around the time Uber Technologies’ Chief Executive Officer Dara Khosrowshahi was on a visit to India.
Uber has already transferred its Indian ride sharing and Uber Eats business to Indian entity Uber India System from the Netherlands entity. The capital infusion is expected to bolster its presence in the country by funding its key businesses to take on Indian rival Ola.
“This is the single-largest foreign direct investment by Uber into its Indian operations and follows the transfer of its India business from a Dutch entity to an Indian entity,” said Vivek Durai, founder of Paper.vc.
In its board meeting held on October 1, Uber India board had passed a resolution to allot close to 15.99 million shares to Uber BV with a face value of Rs 10 and premium of Rs 1578.20 each, to raise Rs 2,539 crore, according to data sourced from business intelligence platform Tofler. “We estimate that a large part of this allocation would go towards to (Uber) Eats business, therefore posing a direct challenge to other food delivery companies such as Swiggy and Zomato,” said Durai of Paper.vc.
Last month, Khosrowshahi was in Delhi to announce a partnership with Delhi Metro Rail Corporation (DMRC) under which the Uber app would get integrated with the city’s Metro and public bus service to provide commuters a seamless experience while travelling from one point to another.
The company is planning to double the headcount of its Hyderabad and Bengaluru research and development (R&D) centres to 1,000.
It has already developed key products like Uber Lite for the India market, which is now being used globally.
The mega capital infusion by Uber into its India arm comes at a time when rival Ola is coming up with a slew of new products and services.
Last month, the Bengaluru-headquartered firm unveiled ‘Ola Drive’, a self-drive car-sharing service, with a plan to host a fleet of 20,000 cars by 2020. Ola plans to invest $200 million for the new platform initially and raise the investment to up to $500 million in the next couple of years. The company is also planning to launch a portfolio of in-house food brands and take them across the country.