- General
- September 28, 2020
- 4 minutes read
Uber Eyes Free Now Purchase
Photo credit: Daimler Ride-hailing giant Uber is considering a purchase of Free Now, a joint ride-hailing venture between automakers Daimler…
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| Photo credit: Daimler |
Ride-hailing giant Uber is considering a purchase of Free Now, a joint ride-hailing venture between automakers Daimler and BMW, according to a report [paywall] from Bloomberg. According to Bloomberg, Uber indicated an interest in a possible acquisition of Free Now after the ride-hailing joint venture struggled to attract additional investors as sought amid a coronavirus pandemic. Free Now, previously known as Hailo and myTaxi, is one of the largest ride-hailing ventures in Europe and Latin America and could bolster Uber’s business in those regions in the case of an acquisition. Free Now itself is one of the businesses housed under a joint venture between German automakers BMW and Daimler called You Now, which also includes other services such as Park Now, an app for finding parking spots, and Share Now, a car-sharing platform.
Free Now is quite a big business, with a gross merchandise volume that last year amounted to about 2.5 billion euros ($2.9 billion). It’s, however, struggled in the midst of a coronavirus pandemic and even resorted to layoffs in April. Likewise, Uber has also struggled during the pandemic, with thousands of layoffs to show, but got helped by its booming food delivery business. At a moment when ride-hailing businesses are down globally could be an ideal one to make an acquisition, as prices tend to be cheaper in downturns. Uber has long sought to grow its business steadily and has endured billions of dollars in losses along the way. It’s such that the San Francisco-based company acquiring Free Now to boost its business wouldn’t sound far-fetched in any way.
Daimler and BMW each hold 50% stakes in You Now, the ride-hailing joint venture which Free Now is housed under. Daimler valued its equity portion of the company at 618 million euros ($720 million), entailing that a deal with Uber could fetch somewhere around 2x that amount, given that Free Now makes up the majority of You Now’s business.
