Uber's Takeover of Careem Could Unlock More Ride Options for Travelers
One of the world's largest ride-hailing companies, Uber, is set to prepare an IPO sometime in the next few months, but before it does that, Bloomberg reports that Uber will purchase Careem, a ride-hailing service primarily used in Middle Eastern and African countries.
Uber will acquire Careem in a $3.1 billion cash-and-share deal that is expected to be announced as early as this week. The deal includes $1.4 billion in cash and $1.7 billion in convertible notes, with those notes being converted to Uber shares worth $55 each.
Careem is headquartered in Dubai and operates rides in the United Arab Emirates, Qatar, Saudi Arabia, Bahrain, Lebanon, Pakistan, Kuwait, Egypt, Morocco, Jordan, Turkey, Palestine, Iraq and Sudan. Careem has more than a million drivers on its platform and is in more than 90 cities spread across the world.
The purchase of Careem would complement and somewhat overlap with Uber's footprint — the San Francisco-based ride-hailing giant currently operates in 65 countries and 10 of the countries Careem is already in. Uber doesn't have drivers in Kuwait, Palestine, Iraq and Sudan. Careem also has purchased companies that operate food delivery services similar to Uber Eats and is working on its own food delivery business.
It's unclear if Careem drivers will be ported over to the Uber platform once the deal is completed, but if that is the case, it could open up many more drivers, cities and countries for riders who prefer using the Uber app. Part of Uber's appeal to travelers is that you can open up the app in any city Uber's available in and order a ride without having to download and learn a new app.
Uber has struggled to compete in some overseas markets, instead selling off its operations for stakes in competitors, as was the case with Grab in Southeast Asia and Didi Chuxing in China.
We reached out to Careem but have not received response from the company. An Uber spokesperson declined to comment on the news.
TPG featured card
at Capital One's secure site
Terms & restrictions apply. See rates & fees.
| 5X miles | Earn 5X miles on hotels, vacation rentals and rental cars booked through Capital One Travel |
| 2X miles | Earn unlimited 2X miles on every purchase, every day |
Pros
- Stellar welcome offer of 75,000 miles after spending $4,000 on purchases in the first three months from account opening. Plus, a $250 Capital One Travel credit to use in your first cardholder year upon account opening.
- You'll earn 2 miles per dollar on every purchase, which means you won't have to worry about memorizing bonus categories
- Rewards are versatile and can be redeemed for a statement credit or transferred to Capital One’s transfer partners
Cons
- Highest bonus-earning categories only on travel booked via Capital One Travel
- LIMITED-TIME OFFER: Enjoy $250 to use on Capital One Travel in your first cardholder year, plus earn 75,000 bonus miles once you spend $4,000 on purchases within the first 3 months from account opening - that’s equal to $1,000 in travel
- Earn unlimited 2X miles on every purchase, every day
- Earn 5X miles on hotels, vacation rentals and rental cars booked through Capital One Travel
- Miles won't expire for the life of the account and there's no limit to how many you can earn
- Receive up to a $120 credit for Global Entry or TSA PreCheck®
- Use your miles to get reimbursed for any travel purchase—or redeem by booking a trip through Capital One Travel
- Enjoy a $50 experience credit and other premium benefits with every hotel and vacation rental booked from the Lifestyle Collection
- Transfer your miles to your choice of 15+ travel loyalty programs
- Top rated mobile app