Ola-Uber merger: Here’s all you need to know; 10 points

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The cab aggregators, Ola and Uber were reported to be heading towards their merger, however, both the companies denied the media reports. The two companies have been slugging it out in an intensely competitive Indian market and have spent billions in incentives and discounts to passengers.

An Economic Times report said that Ola Chief Executive Bhavish Aggarwal had met top Uber executives in San Francisco, United States, citing two sources.

A 10-point guide about Ola-Uber merger

1) In an official statement, Uber refuted the talks of merging with its rival organization Ola. “That report is inaccurate. We are not, nor have we been, in merger talks with Ola,” Uber said.

2) Ola too denied the reports of its merger with Uber. Ola CEO Bhavish Aggarwal tweeted, “Absolute rubbish. We’re very profitable and growing well. If some other companies want to exit their business from India they are welcome to! We will never merge.”

3) A spokesperson of Ola also said, “Ola is one of the most profitable ride hailing companies in the world with a strong balance sheet. We are the market leader in India and are much bigger than other player. Hence, merger of any kind is completely out of the equation.”

4) Uber sold its local food delivery business Uber Eats to Zomato Ltd in January 2020, while Ola shut down its grocery delivery business and has of late invested billions of dollars in its electric vehicle venture, Ola Electric Mobility .

5) The companies once again revived talks to merge their businesses in India, in a deal being brokered by common investor SoftBank Group Corp in 2018. The talks between senior executives of the firms over the past few years indicated that home-grown Ola will take over Uber India

6) Reportedly, the two companies sat for a merger talks four years ago when Masayoshi Son-led Softbank, an investor in both the banks, pushed pushed them for a merger.

7) Ola reported a sizeable jump in losses in fiscal year 2017 (FY17). While net revenue rose by ₹ 677 crore over FY16 revenue to ₹ 1,178 crore, operating loss widened by ₹ 911 crore to ₹ 3,731 crore.

8) The Central Consumer Protection Authority (CCPA) has issued notices to ride-hailing companies Ola and Uber for alleged unfair trade practices and violation of consumer rights.

9) The primary issues alleged in the notices included deficiency in service, inadequate consumer grievance redressal mechanism, unreasonable levy of cancellation charge and inclusion of charges for add-on services by way of pre-ticked boxes without explicit consent before each ride, the CCPA said.

10) Ola is likely to fire its around 1,000 employees as it ramps up hiring for its electric mobility business, according to a report by the Economic Times.