Uber could sign a $ 3.1 billion deal to buy Careem, its rival Middle East, on Monday

The carpool giant, Uber, is preparing to buy out its competitor Careem, based in Dubai, under a $ 3.1 billion deal, against the recent trend to withdraw from foreign markets, according to reports from Bloomberg and the Financial Times this weekend.

According to this information, the deal could be signed as early as Monday and announced Tuesday, although spokespeople for Uber and Careem have not commented on Bloomberg. During a fundraiser in 2016 and $ 2 billion last year, Careem already had an estimated value of about $ 1 billion. It is currently implanted in more than 90 cities in 15 countries and has more than 30 million users in the Middle East, North Africa and South Asia.

As the Financial Times wrote, a successful sale would be a "historic moment" for the region's technology and venture capital industries, which "have struggled to produce some outstanding success stories":

Amazon acquired the regional e-commerce site Souq.com in 2017 for approximately $ 650 million.

"This is a validation of the technological space of the region and all those who have invested in this space in recent years," said an investor.

Uber and Careem are the two dominant companies in their shared territories, which means that the merger could create a de facto monopoly in some places. The main sponsors of Careem include the Japanese company Rakuten Inc. and the Kingdom Holding Company, an investment company headed by Saudi Prince Alwaleed bin Talal. Engadget noted that this agreement could allow Uber to receive more funds from Saudi society (even at a time when some big companies have become nervous about the atrocious record of human rights in the country).

Last year, Careem and Uber escaped a ban in Egypt after a lawsuit filed by traditional taxi drivers declared that they had violated the laws on the use of vehicles private enterprises and that they illegally registered their businesses in different sectors. Careem and Uber also operate in Turkey. Last year, President Recep Tayyip Erdogan threatened to send Uber to the door and authorities began targeting the company's taxis and passengers for heavy fines. Careem also faced difficulties in Turkey because of similar political problems and reduced its high-end services in that country.

Uber has already used this type of merger to escape an expensive price war with new foreign companies that emerged after its global launch. It merged with its Russian competitor Yandex, sold its Southeast Asian market to Grab and sold its Chinese business to Didi Chuxing. Uber is moving away from the historic strategy as Uber approaches an initial public offering, which is expected to take place in April and could bring $ 120 billion back to the company.

[Bloomberg/Financial Times]