Online cab booking service Olacabs.com, run by Mumbai-based ANI Technologies Pvt Ltd., is in advance talks to acquire Bangalore-based Serendipity Infolabs Pvt Ltd which runs rival service TaxiForSure, as per separate media reports citing sources.
This comes amidst TaxiForSure engaging new investors to raise around $100 million while separating Olacabs is in talks to raise as much as $500 million in a new round.
Both the companies act as aggregators of radio taxis and the move is seen as a strategy to counter global giant Uber in India. While Olacabs has a presence in 52 cities, TaxiForSure is in 44 cities.
Besides intra-city rides, TaxiForSure also offers cabs for outstation trips. Olacabs had discontinued this service sometime back.
Although taxi service is a highly fragmented business in India, Olacabs and TaxiForSure are believed to be among the top five in the organised space. As a marketplace for cabs, it is the second biggest close behind Olacabs in terms of the number of cities it operates currently. It would be interesting to see if the deal triggers a closer scrutiny by the competition watchdog.
“This news is speculative and as a company policy we do not comment on any market speculation,” said TaxiForSure in an email response to VCCircle.
Olacabs did not immediately respond to an email query.
As per the media reports, the deal pegged at around $200 million will involve both cash and stock swap. Given the rumoured amount it will be the second-largest buyout in the consumer internet market after Flipkart’s acquisition of fashion portal Myntra for an estimated over $300 million last year.
Both the companies were founded in 2011. Olacabs was founded by IIT Bombay alumnus Bhavish Aggarwal and Ankit Bharti. TaxiForSure was founded by Raghunandan G and Radhakrishna, both engineering graduates from NITK Surathkal who got their management degrees from IIM Ahmedabad. Radhakrishna has also worked as the head of business development for PDS at Jones Lang LaSalle, India while Raghunandan earlier worked with Feedback Ventures as a consultant.
TaxiForSure counts Accel Partners, Helion Venture Partners, Blume Ventures and Bessemer Venture Partners among its backers. Last August it raised an undisclosed amount in its Series C round of funding led by Accel Partners, with participation of existing investors.
Olacabs raised a large Series D round where Japan’s SoftBank led a $210 million investment in the venture. Existing investors Tiger Global, Matrix Partners and Steadview Capital also participated in the round.
(Edited by Joby Puthuparampil Johnson)
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