Uber will close a deal to buy its Middle East rival for $3.1 billion as soon as today, reports Bloomberg. If so, the acquisition would come just a month before the ride-hailing behemoth is expected to file for an IPO.
If accurate, the sale price would be as much as $1 billion more than Uber was reportedly offering last fall. Last September, Bloomberg reported that Uber was considering buying Careem for $2 billion to $2.5 billion.
Uber is under pressure to make itself look as attractive as possible ahead of its hotly anticipated IPO. Over the last few years, it has ceded operations in Russia, China, and Southeast Asia, and company executives have said they intend to remain dominant in other markets around the world.
Careem, which was founded in 2012, has given Uber a run for the money in a region not known for its startup prowess. (See our profile of Careem: “How a Middle East startup took on Uber–and won.”) The company operates in at least 120 cities from Morocco to Pakistan, compared to fewer than 20 for Uber. The purchase of Careem effectively buys Uber an entirely new region.
The sale would constitute one of only a handful of significant exits in the Middle East, a region that lags behind the rest of the world in entrepreneurial activity. The last major sale was of Souq to Amazon in 2017 for a little over half a billion.