The country’s largest home-grown ride-hailing firm, Ola, has acquired food delivery company Foodpanda’s India business from its German parent, Delivery Hero. It announced the all-stock deal today (Dec. 19) in a press release, though it did not disclose the cost of the acquisition.
Ola will invest $200 million (Rs1,282 crore) into Foodpanda India.
Saurabh Kochhar, the current CEO of Foodpanda India, has decided to move on, the release said. The company will now be headed by Ola’s founding partner Pranay Jivrajka, it added.
“Foodpanda India will benefit from Ola’s scale and efficiencies as a platform, also having leveraged learnings from Delivery Hero’s global best practices,” a press release from Ola said. “Ola and Delivery Hero will continue to collaborate on building the online food delivery ecosystem in India.”
This will be Ola’s second outing in the food delivery space. In 2015, the company entered the market organically with a service called Ola Cafe in Delhi, Mumbai, Bengaluru, and Hyderabad. However, it discontinued the service after a year as it reportedly failed to meet targets.
Meanwhile, rival Uber has been running its meal order and delivery platform UberEATS in India since May this year. The service is available in six cities, according to a company press release issued last week.
With this acquisition, Ola will now have access to Foodpanda’s delivery network across over 100 cities, which includes menus from over 15,000 restaurants.
While Uber and Ola have established themselves as leaders in the online ride-hailing space in India, this will be a different game altogether. The food delivery segment in India is currently crowded with several strong players such as Swiggy and Zomato, who themselves have been struggling to make money.