Uber Technologies Inc. plans to buy a majority stake in online grocer Cornershop, a deal designed to both extend its geographic reach and bolster profits by bundling food delivery with rides.
The move, which is subject to regulatory approval, could end uncertainty for a Santiago, Chile-based startup backed by Accel and other venture investors. Walmart Inc. announced its intention more than a year ago to purchase Cornershop outright for $225 million and re-sell it to its Mexican subsidiary, only to have Mexican regulators oppose it in June for antitrust reasons.
Uber says it expects the deal to close in early 2020. Cornershop will continue to operate under its current leadership, reporting to a board with majority Uber representation. The four-year-old startup is known for its promise to deliver groceries in one hour and operates in Chile, Mexico, Peru and Toronto, Canada. Terms of the deal were not disclosed.
The arrangement could play a significant role in Uber’s strategy of layering more profitable services atop ride-sharing. Since the company’s disappointing initial public offering, share prices have cratered and Chief Executive Officer Dara Khosrowshahi has sought to reassure investors that Uber is both focused on turning a profit and continuing to grow.
“Whether it’s getting a ride, ordering food from your favorite restaurant, or soon, getting groceries delivered, we want Uber to be the operating system for your everyday life,” Khosrowshahi said in a prepared statement announcing the deal.
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