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Ola and Uber, which compete in the area of mobility are in talks for a possible merger, according to media reports, which said that Ola’s co-founder and CEO Bhavish Aggarwal met top Uber executives in San Francisco, US recently.
However, Aggarwal said on Friday night that there is no such development.
“Absolute rubbish. We’re very profitable and growing well. If some other companies want to exit their business from India they are welcome to! We will never merge,” said Aggarwal on Twitter. “We are not, nor have been, in merger talks with Ola,” said Uber spokesperson.
In the past, both the companies have held such conversations as Masayoshi Son-led SoftBank is a common investor in both the companies and it had pushed for a merger. But the deal didn’t happen that time. However, now the conversations for a merger have come up again as both the companies are looking for growth at a time when the Covid-19 pandemic has hurt the transportation industry.
However, an Ola spokesperson on Friday said that the firm is one of the most profitable ride-hailing companies in the world with a strong balance sheet. “We are the market leader in India and are much bigger than other player. Hence, merger of any kind is completely out of the equation,” said the spokesperson. “We believe that India has a lot more opportunity to unlock when it comes to mobility services. As a strong vertically integrated mobility company we will further consolidate our position by any acquisition in the Indian market, if at all.”
Such developments may happen at a time when the company is repurposing some of its infrastructure and capabilities toward boosting the Ola Electric sales and service network.
Ola is in the process of laying off 400-500 employees, a move aimed at driving cost efficiency, revealed sources. They said these layoffs are taking place across departments, amid a challenging funding environment and a delay in listing plans for the Bhavish Aggarwal-led firm.
The company recently shut down its used vehicle business Ola Cars and quick-commerce business Ola Dash, which promised 10-minute food delivery. It has repurposed the infrastructure and capabilities of the Ola Cars business towards boosting the Ola Electric sales and service network.
The company shut down Ola Cars within a year of its launch as it shifted focus to its electric two-wheeler and car verticals. Ola has, so far, shut down Ola Cafe, Food Panda, Ola Foods, and Ola Dash.
Ola has a total workforce of around 5,000 people. In May 2020, Ola announced laying off 1,400 employees, or over 33 per cent of its workforce, as Covid-19 continued to hurt the transportation industry. The Bengaluru-based firm said it had to opt for sackings because the situation was not expected to improve anytime soon.
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