ZomatoCredits: Reuters

Berlin-based food delivery firm Delivery Hero Group has acquired Zomato's business in the United Arab Emirates (UAE) for around $172 million. The German food tech company signed an agreement with India's food delivery online player, Zomato to take over its business via Delivery Hero's fully owned subsidiary Talabat Middle East Internet Services Company LLC. In a media statement, the company said: "The acquisition will add 1.2 million monthly orders and $2 million monthly revenue to Delivery Hero's Far East and North Africa business and will strengthen its leadership position in the UAE. The acquisition will be fully funded by an acquisition facility."

Apart from buying Zomato's UAE business, Delivery Hero also participated in Zomato's latest funding round. The German company is learned to have injected $50 million in Zomato's global business. After the investment, Delivery Hero will become one of the top 10 shareholders in Zomato.  

Gurgaon-based  Zomato is fighting a battle with its cash-rich rival Swiggy. Over the next few months, it is planning to raise close to $1 billion to take on Swiggy. In the latest round of funding, Zomato has raised $105 million from Delivery Hero, Glade Brook Capital, Shunwei Capital, and Saturn Shine. After this, the valuation of the company stands at $2 billion. Delivery Hero also has plans to re-enter the Indian markets; interestingly, in 2014 it had exited India after selling its shares in Pune-based TastyKhana to Foodpanda, which is now owned by Ola.

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"Zomato has built a successful food delivery business in the UAE and India on the back of its restaurant search and discovery app and website. The acquisition will allow us to further improve our service to customers in the UAE. We are also excited to become a shareholder in Zomato's rapid food delivery growth story in India and share our learnings," said Niklas Östberg, CEO of Delivery Hero.

Since last one year, Zomato is witnessing major shake-ups in its team which included the exit of former co-founder Pankaj Chaddah, who called it quits just after Alibaba entered the firm as one of the major investors. The company is now expanding its verticals including Zomato Gold and HyperPure as well as launching events business, Zomaland. The company had posted losses of Rs 201.4 crore in the financial year 2017. The fiscal year 2018 witnessed the company's revenue from operations rose 40.3% to Rs 466.3 crore.