Mobile app based online cab booking service Ola has bought rival TaxiForSure for $200 million in a cash-and-equity deal. Notably, TaxiForSure is India's second largest cab aggregator and this is first merger and acquisition (M&A) in the taxi service aggregator space.
This acquisition deal by Ola is among the biggest in India's startup industry after Flipkart's purchase of Myntra for about $300 million in May last year.
Ola and TaxiForSure will continue to operate as separate entities, said a statement. The leadership and all of the 1700 employees shall continue to work with TaxiForSure, with Arvind Singhal (currently COO) being appointed the CEO. Aprameya Radhakrishna and Raghunandan G, the founders of TaxiForSure, will contribute in an advisory role for a certain period.
TaxiForSure currently operates in 47 cities with over 15,000 vehicles registered on its platform. With the acquisition, investors in TaxiForSure will roll over their stock into Ola, the company said.
According to Raghunandan G, Co-founder and CEO, TaxiForSure the brands coming together will provide more opportunity than ever to do what they do best. "Post this acquisition; the combined entity will be strong enough and better capitalized to offer the best value to all our stakeholders, including our customers. This development ensures that industry attractiveness is preserved and the combined entity can race ahead and continue to create unprecedented value for all stakeholders."
Ola has been funded by Tiger Global, Matrix Partners, Sequoia Capital, Steadview Capital and most recently, Japan's Softbank over its four rounds of fund-raising. Investors in TaxiForSure are Accel Partners, Bessemer Venture Partners and Helion Venture Partners.
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