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Uber to buy alcohol delivery start-up Drizly for $1.1bn

Uber has made a major move in the growing market for on-demand delivery of wines, beer and spirits by agreeing to buy start-up firm Drizly in the US in a deal worth $1.1bn.

Uber said it had significant growth ambitions for Drizly, which has seen rapid growth in the US with its app offering on-demand delivery of wines, as well as beer and spirits.

If approved by regulators, the $1.1bn deal will see Drizly become a wholly-owned subsidiary of Uber.

Drizly operates in 1,400 US cities and the takeover highlights how the market for on-demand delivery of food and drink has developed in recent years, becoming increasingly competitive.

Lockdown restrictions have also led to more people ordering wine online to drink at home in the past 12 months.

‘Wherever you want to go and whatever you need to get, our goal at Uber is to make people’s lives a little bit easier,’ said Uber’s CEO, Dara Khosrowshahi.

‘That’s why we’ve been branching into new categories like groceries, prescriptions and, now, alcohol.’

He added, ‘By bringing Drizly into the Uber family, we can accelerate that trajectory by exposing Drizly to the Uber audience and expanding its geographic presence into our global footprint in the years ahead.’

Uber and Drizly said in a joint-statement that Drizly’s marketplace would eventually be integrated into the Uber Eats app. They said that would also give merchants on Drizly access to Uber’s customer base.

However, the firms added that Drizly will continue to operate its standalone app and that the Drizly team ‘plans to innovate and expand independently in its fast-growing and competitive sector’.

Drizly’s co-founder and CEO, Cory Rellas, said that it was a proud day for the team after eight years of building its infrastructure, technology and partnerships.

Commenting on the deal structure, Uber said it anticipated more than 90% of the $1.1bn would consist of shares of Uber common stock, with the remaining balance to be paid in cash.

Uber said it expected the deal to complete in the first half of 2021, subject to regulatory approval.

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