Egypt and Uber has entered an agreement for the acquisition of Careem, a ride-hailing firm that has operated in Egypt since 2014. The agreement on Uber Technologies Inc.’s acquisition of Careem Inc came with clauses that sets price caps and other measures designed to keep the local market competitive.
The decision was made after studying data on 270 million trips as well as Egyptian and international precedents, the Egyptian Competition Authority said Sunday in a statement.A
Amongthe commitments the authority placed on the acquisition contract is that any raising of passenger prices has to comply with cap imposed by the ECA.
Also a cap was placed on pricing such that surgepricing, wherein rides temporarily become more expensive due to increased demand, will be limited to 2.5 times the normal trip cost. While companies won’t increase the commission they deduct from drivers beyond current rate.
It was also agreed that the r growth of new competitors will be encouraged by allowing them access to Uber’s mapping and trip data, plus letting them obtain user data from Uber and Careem applications, after obtaining users’ consent
Uber in March announced its $3.1 billion purchase of its Dubai-based competitor Careem. Both companies have operated in Egypt since 2014, with their services in the Arab world’s most populous nation including app-hailed passenger vehicles, buses and deliveries.
Analysts see this as a new strategy by Uber to acquire competitors especially in Africa.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry