Uber Technologies Weighs Purchase of BMW-Daimler Ride-hailing Venture

Business Standard Uber Technologies weighs purchase of BMW-Daimler ride-hailing venture

Uber expressed interest in a potential acquisition of Free Now after the venture's efforts to attract additional investors struggled to gain traction.

Uber Technologies Inc. is considering a purchase of Daimler AG and BMW AG’s ride-hailing joint venture Free Now, a deal that could boost its market share in Europe and Latin America, people with knowledge of the matter said.

Uber expressed interest in a potential acquisition of Free Now after the venture’s efforts to attract additional investors struggled to gain traction amid the coronavirus pandemic, according to the people, who asked not to be identified because the information is private. Any deal could be complicated by the challenging market ride-hailing companies face, which could make it more difficult to agree on a price, one of the people said.

Daimler and BMW’s shopping of Free Now reflects their focus on generating cash and improving efficiency within their core automotive operations.

Carmakers have been scaling back their mobility-service ambitions, with General Motors Co. shutting down its Maven car-sharing business earlier this year and Ford Motor Co. ceasing its Chariot shuttle service in 2019. “If external investors aren’t willing to provide capital, why should Daimler/BMW put more money in?” Bernstein analysts Arndt Ellinghorst and Thanos Hadjiantonis wrote in a note.

“The traditional industry has begun to realize it’s been wasting a lot of time, effort and money by trying to compete in these areas with questionable medium- and long-term returns. ”There’s no certainty the deliberations will lead to a transaction, and other bidders could emerge, the people said. Representatives for Uber and BMW declined to comment, and a Daimler spokeswoman said the company doesn’t comment on speculation.