Uber clears first regulatory hurdle in Careem acquisition

The UAE Minister of Economy has granted full approval of the pending purchase of the ride-hailing company

Uber agreed to buy Careem for $3.1 billion in March, the biggest tech deal in the region to date. Reuters

Uber cleared the first regulatory hurdle of its $3.1 billion acquisition of Dubai ride-hailing app Careem as the UAE Minister of Economy granted full approval of the deal.

The UAE is the first country where Careem operates to provide the go-ahead. Both technology companies continue to work with the relevant antitrust authorities to get remaining approvals across the Middle East, North Africa and Pakistan, Uber said in a statement on Monday.

"Unconditional approval of this deal by the UAE government is a positive step towards the closure of the biggest technology transaction in the region," said a Careem spokesperson. "We welcome the decision and look forward to pursuing the platform opportunity and leapfrogging the region into the digital future."

In March, Uber's purchase of Careem’s mobility, delivery, and payments businesses across all of its markets including Egypt, Jordan, Pakistan, Saudi Arabia and the UAE was - and remains - the biggest technology transaction to date. Under the deal, Careem, a major rival in about 24 of the more than 400 cities where Uber operates, will be able to retain independence in day to day operations.

Uber welcomed the decision by economy minister Sultan Al Mansouri, a company spokesperson said.

As Uber forges ahead with its expansion plans in the Mena region, it faces upheaval in its home market in the US. Last week, chief executive Dara Khosrowshahi emailed the company that Barney Harford, the chief operating officer, and Rebecca Messina, the chief marketing officer, are both leaving the company, and the position of COO is being eliminated.

In an email to employees seen by Reuters, Mr Khosrowshahi said he would be getting "more involved in day-to-day operations" and that two of Uber's biggest businesses, Rides and Eats, would begin reporting directly to him.

In the company's first quarterly financial report released earlier this month, Uber posted a $1.01 billion loss. The stock closed Friday at $44.16 below the IPO price of $45 a share.