This archive report was first published on 6 July 2020.
On July 6, 2020, the COVID-19 pandemic had already taken a significant toll on the global economy, and the rideshare giant Uber was no exception. In May, the company had cut a quarter of its global workforce in an effort to stay afloat.
As the pandemic continued to spread, Uber turned its attention to its growing food delivery service, Uber Eats. The company had been looking for ways to boost its food delivery business, and a potential acquisition of Postmates, a nine-year-old food delivery app, seemed like a promising opportunity.
According to Bloomberg, which cited people familiar with the matter, Uber was expected to announce a $2.65 billion deal with Postmates on Monday morning in the US. The deal would not only bolster Uber's food delivery business but also help Postmates, which had struggled against larger rivals in the market.
Uber's efforts to acquire Postmates come after a failed attempt to buy Grubhub, another US food delivery app, for $6 billion earlier this year. The deal fell through, and Grubhub was later acquired by European competitor Just Eat Takeaway.
Despite the challenges posed by the pandemic, Uber's food delivery business had shown strong revenue growth. In its quarterly update earlier this year, the company reported that it had lost nearly $3 billion and its rides business was down by 80 percent in April. However, the company noted that its Eats food delivery operation was seeing significant revenue growth.
