Uber Technologies Inc. (NASDAQ:UBER) Under Probe Regarding Acquisition of Autocab

The UK Competition and Markets Authority has launched a probe into Uber Technologies Inc. (NASDAQ:UBER) regarding its plan to acquire Autocab. Autocab is a SaaS provider of dispatch and booking software for the private-hire vehicle and Taxi sector, which also runs a global trip marketplace for PHVs (iGo) and taxis.

Uber looking to expand beyond core ride-hailing services

Uber had announced plans for the acquisition of Autocab in August 2020 as part of its efforts to expand its revenue base beyond the core ride-hailing segment.  The CMA has set a deadline of March 26 to decide on whether they will subject the merger for an in-depth probe. Most importantly, there are concerns that competition considerations will increase the ride-hailing giant shutter Autocab’s trip-booking marketplace or do away within the select market where its runs ride-sharing services. Uber indicated when it announced plans to acquire Autocab that its iGo network will help it offer rides where it currently doesn’t have a presence.

Despite the company indicating that the iGo platform will help it in expanding it seems that the move will create more opportunities for Uber drivers outside their app. This means that drivers will puck jobs including delivery work as rid-sharing continues to face a squeeze due to the pandemic. Therefore, the overlap in services offered by Uber and iGo marketplace merits the questions the CMA is asking.

CMA to probe Autocab acquisition

 The competition watchdog is inviting comments in the merger and has set a deadline of February 12 for submissions. The CMA indicated that it is considering whether the acquisition will lead to the creation of a relevant merger situation under the Enterprise Act 2002 provision. If that will be the case, they will look at whether the merger results in lessening competition with markets in the UK.

An Uber spokesperson said that they are cooperating with the CMA in the inquiry to enable it to complete its review quickly. She added that the acquisition will be positive to consumers and will help local operators expand with massive opportunities.

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