Food delivery platform Zomato has signed an agreement to acquire Uber Eats’ business in India for an all-stock deal.

Reportedly valued at around $350m, the deal gives Uber a 9.99% ownership in Zomato.

As part of the agreement, Uber Eats will become inactive in the country and customers will be directed to Zomato once they try to log in.

Nearly 70,000 active delivery partners working on the Uber Eats platform and its restaurant partners will now move to Zomato.

Around 200 Uber Eats employees will be impacted by this deal, reported Times of India.

Zomato stated through its blogpost: “Uber Eats in India will discontinue operations and direct restaurants, delivery partners, and users of the Uber Eats apps to the Zomato platform, effective today.”

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Zomato founder and CEO Deepinder Goyal said: “We are proud to have pioneered restaurant discovery and to have created a leading food delivery business across more than 500 cities in India.

“This acquisition significantly strengthens our position in the category.”

In December 2019, it was reported that the US ride-hailing company Uber was in talks to divest its Indian Uber Eats food delivery business to local competitor Zomato.

With the acquisition, Zomato will have a 55% share of the food delivery market in the country and compete with domestic rival Swiggy, reported LiveMint.

Uber was previously in talks with Swiggy to sell Uber Eats.

Uber Eats had entered the Indian market in 2017 and provided services to 41 cities through more than 65,000 riders, who deliver food from 26,000 restaurant partners.

Uber CEO Dara Khosrowshahi said: “India remains an exceptionally important market to Uber and we will continue to invest in growing our rides business, which is already the clear category leader.

“We have been very impressed by Zomato’s ability to grow rapidly in a capital-efficient manner and we wish them continued success.”

Zomato has recently raised $150m in funding from existing investor Ant Financial, a subsidiary of China-based Alibaba.