Olacabs is reportedly buying TaxiforSure for an amount close to $200-250 million. This will valuate the company close to $2 billion and will make it the biggest competitor to international player Uber in India. Also Read - Get alcohol home delivery online in Delhi using mobile apps, online web portalAlso Read - Uber cab service resumed in 31 cities in India with new Lockdown 4.0 guidelines
Sources aware of this deal have confirmed to Times Of India that the deal has been finalised in terms of cash and stock, and the announcement is set to be made in the coming weeks. TaxiforSure investors may get stocks in Olacabs after acquisition. Also Read - Uber launches 'Uber Connect' package delivery service to rival Dunzo and Swiggy Genie
Started in 2011, TaxiforSure is now spread across 36 cities in India. The company has raised $60 million in funding from international players like Accel Partners and Bessemer Venture Partners, and was looking to raise fresh funds. When the offer was made by Olacabs, TaxiforSure opted for a complete buyout. In comparison, Olacabs raised $210 million in its last round of funding in October from Softbank and existing investors like Tiger Global, Matrix Partners India and Steadview Capital. This influx of international funding testifies the bullishness in the on-demand taxi aggregator business.
Recently, Uber, TaxiforSure and Olacabs had the government weighing down heavily on them, after the rape incident in Delhi. Many aggregators were banned in the national capital, and other cities subsequently. Just recently, the ban was lifted, with the condition to operate under the Radio Taxi license.
All the three companies have applied for license, but a recent report in Business Standard claims that there were many errors in their applications, and has sent back a memo, with ten days of time to fill in all the ‘gaps’.
Olacabs, after the acquisition will become Uber’s biggest competitor in the Indian market. As both the companies are shifting their business model to stay relevant in Delhi, Olacabs has a slight edge over Uber. While Uber will have to now introduce physical offices and customer care centres to operate under the license, Olacabs already has that base covered. It even has a fleet of registered taxis in the city. How the global entity Uber and local giant Olacabs fight it out in the city remains to be seen. Further slash in prices perhaps?