Fatima Al-Kashef

Emirates Telecommunications Group (E&G), listed on the Abu Dhabi Securities Exchange, has signed a binding agreement to sell 12.5% of its stake in Careem Technologies to Uber Technologies, listed on the New York Stock Exchange, for $100 million in cash, according to a disclosure issued by E&G to the exchange on Monday.

Quick backgrounds

Uber had acquired the UAE-based startup Careem for $3.1 billion in January 2020. After the acquisition, Careem continued to operate under its own brand within the Uber Group, expanding from ride-sharing services to a multi-service platform offering food and grocery delivery and other services in several markets in the Middle East, North Africa and South Asia.

But in 2023, Uber decided to separate Careem’s multi-service app business from its ridesharing business, which allowed the UAE’s E&P Group to invest $400 million to acquire a majority stake in Careem Technologies, the owner of Careem’s multi-service app, which offers services such as food and grocery delivery, electronic payment, house cleaning and laundry, while Uber retained full ownership of its ridesharing business.

More details about the new deal

(According to the statement)

Under the agreement, E&P's stake in Careem Technologies will decrease to 37.53% from the current 50.03%.

E&P said in the statement that over the past two years, Careem Technologies' revenue growth has accelerated as its market share in the UAE has increased, and the volume of core transactions has nearly quintupled, supported by food and grocery delivery, electronic payment and subscription services.

The agreement includes reciprocal sale and purchase options that allow E& to demand that Uber buy its remaining stake in Careem Technologies, and also give Uber the right to demand that E& sell that stake, during the period between December 2031 and January 2032.

E&P said its partial exit reflects a strategic focus on its core business with a disciplined allocation of capital priorities while maintaining alignment with Careem Technologies' future trajectory to capitalize on its business volume growth.

The completion of the transaction is subject to regulatory approvals and a number of standard conditions and procedures.

(Prepared by: Fatima Al-Kashef, Edited by: Shaimaa Hefzy, Contact: zawya.arabic@lseg.com )

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