The deal would merge two major food delivery platforms amid skyrocketing demand for such services during the coronavirus pandemic. Uber’s meal delivery service, Uber Eats, has been viewed as a bright spot for the company at a time when demand for its core ride-hailing business has slowed as people have increasingly stayed home.
“There is a silver lining to this unbelievably tragic COVID virus, which is the business that we have of Eats and the category in general, just looks like it is going to be substantially increased and some would say by multiples,” said Uber CEO Dara Khosrowshahi on an earnings call with investors last week.
While the food delivery business is promising, it’s also a highly competitive market. Competitors in the US include Postmates and DoorDash, each of which have raised substantial amounts of venture capital to compete.
Uber stock was up 6% late Tuesday morning following the reports.