UAE-based communication firm e& (formerly Etisalat) has acquired a 50.03 per cent stake in Careem’s Super App spinout for $400 million.
Founded in 2012 by Magnus Olsson and Mudassir Sheikha, Careem begun as a ride-hailing app and then launched its super app in April 2020.The app offers a variety of services on its platform including food and grocery delivery, micro-mobility, a digital wallet and a suite of fintech services, alongside third-party services such as home cleaning, car rental and laundry.
Hatem Dowidar, Group CEO, e& commented, “Super Apps have catalysed the economic, social and cultural growth of emerging markets today. The popularity of super apps has come from the need to provide a unique and seamless customer experience. The mobile-first population have given rise to an ecosystem that has encouraged the use and also expanded the scope for super apps with user expectations turned towards performing their daily activities on digital platforms.
“The Careem Super App is a digital native that has built a rapidly growing payments, food and grocery delivery network, and a platform for other digital businesses to scale from. The shared vision between e& and Careem is exciting, we believe that together we’ll be able to enhance our impact across different markets in the region while pushing the boundaries of customer experience.”
With this new investment, Careem plans to accelerate the realisation of its ambitious vision to create the first “everything app” serving customers across the Middle East. This will include expanding its core food, grocery, and fintech services and the Careem Plus subscription programme across the region while adding even more partner services to the app. Careem expects significant synergies with e& and anticipates benefiting from e&’s large customer base and extensive experience scaling complex tech-enabled businesses across a largely shared geographic footprint.
This investment is in line with e&’s strategic ambition of scaling up consumer digital offerings and accelerating its transformation to a global technology and investments group. It provides e& with access to multiple digital verticals, new innovative digital services, strong talent, and new geographies. e& will leverage the Careem Super App to boost the growth of its consumer digital services, including the expansion of e& life’s fintech vertical, e& money, which will play an important role in the super app vision by providing e& money’s powerful financial service offerings.
Careem’s ride-hailing business will remain fully owned by Uber and continue to be available with all other Careem services on the existing app for customers.
e& is investing $400m to become a majority shareholder in Careem’s Super App alongside Uber and all three of Careem’s co-founders.
In recent years e& has transformed into a global technology and investment group. The company is integrating emerging technologies into its expanding business verticals. e& has 163 million subscribers across 16 countries in the Middle East, Asia and Africa.
Dara Khosrowshahi, CEO of Uber said, “Over the last decade, Careem helped revolutionize mobility across the greater Middle East while building an incredible brand. I am thrilled to partner with Careem, and welcome e&, as we grow the Careem super app to deliver more services to millions of people in this fast-moving part of the world. All of us at Uber are excited about the impact the Careem platform will have on this region over the next decade and beyond.”
Khalifa Al Shamsi CEO of e& life said: “We are thrilled to welcome Careem into the e& family with this exciting and ground-breaking deal. There are several growth opportunities between Careem and e& life as the “consumer digital” arm of e&. Our current strengths, primarily in fintech and multimedia, coupled with Careem’s services and regional footprint, will accelerate our joint vision towards a regional super app. With this partnership between e&, Careem and Uber we will set new standards of product innovation and customer experience throughout the region.”
Careem CEO and co-founder Mudassir Sheikha said, “The opportunity to use technology to leapfrog the lives of people in the region is enormous. Uber has been an incredible partner over the last three years as we expanded our mission to simplify the lives of people with everyday services beyond ride-hailing. We are excited to bring e& into the family. Their passion for uplifting the region and the synergies across their portfolio are extremely valuable. With two strong partners in e& and Uber, I have no doubt that we will build the preeminent technology platform of the region.”
Since Uber’s acquisition in 2020, Careem has evolved to become a multiservice app offering users over a dozen services. In 2022 in the UAE, Quik, the grocery delivery service, grew 46X, and food orders grew by 86 per cent. Over the course of the year, Careem Pay launched as a true fintech in the UAE with a digital wallet and payments products including bill payments, international remittances, domestic peer-to-peer payments, and one-click checkout. Careem Bike doubled its network of pedal assist bikes and grew by 61%. Careem launched its popular subscription service Careem Plus, which saw its first partner service (home cleaning) grow 4.9x while it also onboarded new third-party partners offering rental cars, spa and laundry services.
Completion of the transaction remains subject to regulatory approvals, customary closing conditions, and administrative procedures.