Following the announcement of Uber buying Careem for $3.1 billion (Dh11.39bn), Saudi Arabia's Al Tayyar Travel Group, the largest corporate shareholder and one of the earliest investors in the Dubai ride hailer, is divesting its investment in the company with an exit value of 1.78bn Saudi riyals (Dh1.74bn).
The net proceeds from the sale will be received partly in cash and partly in convertible notes in Uber, Al Tayyar said on Tuesday. Careem has operations in 15 countries and the acquisition of its business in each country is subject to applicable regulatory approvals. The transaction is expected to close in the first quarter of 2020.
“This is a historic moment for the Middle East tech space," said Abdullah Aldawood, chief executive of Al Tayyar Travel.
"[The Uber-Careem deal] is the largest tech deal in the region and a milestone that will provide the stimulus to grow the digital ecosystem and attract more foreign investments."
The Saudi group, whose gross booking value through its online platform increased by 44 per cent last year to 2bn riyals compared to 1.38bn riyals in 2017, first invested in Careem in December 2014. It has continued to be an active investor supporting the company and its founders, with Mr Aldawood a member of the board of directors of Careem since its first investment.
"We have always been firm believers in the company and its vision to be an enabler on both the economic and social front – and that is exactly what Careem is today, it has facilitated and improved the lives of millions of people," said Mr Aldawood. "Getting to this point was the culmination of the hard work, determination and forward-thinking vision of the Careem team and the unwavering support and guidance from us at the group.
"We believe the region is ripe for the development of other tech-enabled travel services and solutions. More specifically, we believe in opening up the opportunity of consumer travel, and this is where we are focused today," he said.
Al Tayyar said its consumer travel business reached 1.8 million customers last year, 1 million of whom were through its online platform, growing by 43 per cent year-on-year.
