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The UAE telecoms operator e&, formerly known as Etisalat, has signed a binding agreement with Uber Technologies Inc to invest $400 million in exchange for a majority stake in Careem's super-app business.
The transaction cost will be financed from existing cash balance, the telecoms operator said in a regulatory disclosure on Abu Dhabi Securities Exchange (ADX) on Monday.
The acquisition of the 50.03% stake will allow e& to accelerate the development of the company and create a regional Super App champion, it added.
The acquisition is in line with the $57 billion telecoms group's strategic plans to diversify operations and extend its reach globally. It became the largest shareholder in Vodafone Group after boosting its holdings to 14% earlier this year. Last year, e& signed an agreement with South Korea's Bespin Global, a multi-cloud solution provider, to form a joint venture with an initial capital of $10 million.
Careem’s Ride Hailing business will be separated from Careem Super App and will be fully owned by Uber, while remaining an integral part of the Careem Super App, the statement said. Uber bought its Dubai-headquartered rival Careem, which operates predominantly in the Middle East, for $3.1 billion in 2019.
(Reporting by Brinda Darasha; editing by Seban Scaria)
