Ola today announced a partnership with Germany based DeliveryHero Group, an online food ordering and delivery marketplace. As a part of this partnership, Ola will have now have rights over Foodpanda India business in an acquisition deal in exchange for Ola stock.
Both the DeliveryHero and Ola will collaborate in building the online food delivery ecosystem in India. With Ola having over two million rides per day, it definitely is an ideal buyer of the leading food delivery service. Furthermore, Ola said that it is committed to investing $200 million into the Foodpanda India business, thus making the largest such fund infusion in India’s online food ordering and delivery industry.
After Saurabh Kochhar who was the CEO of Foodpanda decided to quit the company and move on, Pranay Jivrajka, Founding Partner at Ola, has been appointed as interim CEO of this business unit with support from existing leadership team at Foodpanda India. Foodpanda currently claims to be having 15,000 restaurant partners in over 100 cities, though the company didn’t really see the intended results because of the issues it ran into.
Commenting on the deal, Bhavish Aggarwal, Co-founder, and CEO at Ola said:
I’m excited about our partnership with Delivery Hero as we team up to take Foodpanda India to the next level. As one of India’s pioneers in the food delivery space, Foodpanda has come to be a very efficient and profit focused business over the last couple of years. Our commitment to invest $200mn in Foodpanda India will help the business be focused on growth by creating value for customers and partners. With Delivery Hero’s global leadership and Ola’s platform capabilities with unique local insights, this partnership is born out of strength. I look forward to welcoming the Foodpanda India team to the Ola family. I also thank Saurabh Kochhar for building a wonderful team at Foodpanda India over the last couple of years and wish him the very best in his new endeavours.
Niklas Östberg, Chief Executive Officer and Co-founder of Delivery Hero AG, said:
The partnership with Ola will allow us to further consolidate markets where it strategically makes sense to collaborate with leading local players. At the same time, we consider our stake in Ola as a very valuable asset, while Ola’s investment commitment in Foodpanda India is a clear and confident signal to the Indian market. The Foodpanda India team has done a tremendous job building the business and we look forward to supporting them and the Ola team in the future.