OLA TO ACQUIRE FOODPANDA’S INDIA UNIT, PUMP IN $200 MN

Cab hailing app Ola on Tuesday said it will acquire Foodpanda's India business from Germanybased Delivery Hero Group in exchange of its stock.

Besides, the Softbank-backed company has committed investments to the tune of $200 million in the Foodpanda India business, which is the largest such funds infusion in an Indian online food ordering and delivery company till now.

Under the deal, Foodpanda's India business will be transferred to Ola in exchange of the latter's stock, Ola said in a statement.

It, however, did not divulge details about the number of shares that will be part of the transaction.

In 2014, Ola had forayed into the food delivery business with Ola Cafe and had expanded the offering to cities like Delhi, Mumbai and Bengaluru. However, Ola Cafe was later shut down.

The competition has been intense in the segment with the likes of Zomato and Swiggy competing aggressively to capture the market. It heated up further after the entry of UBEREATS -- the food delivery service of Ola's rival Uber -- in the Indian market a few months ago.

According to industry sources, the Softbank-backed Ola had been working on getting back into the food delivery business to compete against UBEREATS and that the acquisition of Foodpanda India is a step in that direction.

They did not wish to be identified as the discussions are private. Ola did not comment on the matter.

Ola said Foodpanda India will benefit from its scale and efficiencies as a platform and it will continue to collaborate with Delivery Hero on building the online food delivery ecosystem in India.

Saurabh Kochhar, who was the CEO of Foodpanda India until recently, has decided to move on to pursue other opportunities.

Ola Founding Partner Pranay Jivrajka has been appointed as interim CEO of this business unit, supported by the existing leadership team at Foodpanda India.

Foodpanda has over 15,000 restaurants across 100 Indian cities on its platform.