The Silicon Review ^Asia

The Gurgaon-based food delivery platform, Zomato, sells its UAE business unit to Berlin-based Delivery Hero for a whopping $172 million (Rs 1,220 Crore). The food delivery company has also raised $105 million in its latest funding tranche with Delivery Hero also participating in the round, The Economic Times reported on Tuesday.

Niklas Östberg, CEO of Delivery Hero, said: “The acquisition of the UAE delivery business would add 1.2-million monthly orders and $2-million monthly revenue to Delivery Hero’s Middle East and North Africa business.”

“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,” he said. Mr.Östberg was quoted as saying by ET.

The sale proceeds will help Zomato shore up its cash reserves as it plans to raise $500 million to $1billion in fresh funds, ET reported in its January 2 edition.

According to the report (appeared on Tuesday), Talabat Middle East, which operates Zomato’s UAE business, will continue to run its allied businesses such as ad sales and Zomato Gold.

With the $315 million round (on-going since last year), Zomato is valued at $2 billion. Despite raising big money, the company is facing tough competition from its cash-rich rival Swiggy.