The ride-hailing service Uber has had transnational success – judging by consistent media reports that unconnected taxis and buses have in some cases taken to the streets to derail the invention. This has been so in SA where many Uber drivers have complained that onerous restrictions on the use of the system has prevented them from building an enterprise on the basis of their private vehicles. Clearly Uber is here to stay – as reported by India’s Tata Capital, which intends to engineer “a fund it manages” to spread Uber throughout the country, and Uber announced in July that it would commit $1 billion to the expansion. This response is a positive and job-creating initiative which holds challenges for local authorities as they are faced with a situation that pits conventional drivers against the growing power of Uber. – Peter Wilhelm
(Bloomberg) – Tata Capital Ltd said a fund it advises will make a “significant investment” in Uber Technologies Inc to help the ride-sharing service expand in India. The investment by Tata Opportunities Fund will allow Uber to benefit from its network in the country, Tata Capital said in a statement on Wednesday, without elaborating. Tata Capital is part of the $109 billion coffee-to-cars conglomerate with over 100 group firms.
The fund typically invests up to $100 million in its deals, its managing partner Padmanabh Sinha said. But Uber in July said it would spend $1 billion to fan out to more Indian cities as the ride-hailing company targets to reach 1 million trips per day in the next six to nine months. Microsoft Corp is said to have agreed to invest about $100 million in Uber valuing it at about $50 billion.
“Right now, we’re particularly focused on building a great service for hundreds of millions of Indians,” Uber Chief Executive Officer Travis Kalanick said in the statement. “Tata’s leadership and experience will be crucial in helping us meet this important goal.”
Uber has more than 150,000 drivers and a market share of about 35 percent in India, according to the statement. “The strategic partnership with Tata fund can take different shapes over time” and partnerships with other group companies were being explored, Amit Jain, president of Uber India, said without elaborating.
Tata Opportunities Fund plans to raise around $700 million more next year after fully utilising its current $600 million by March, Sinha said. It has so far invested in companies such as Ginger Hotels, Tata Sky, Shriram Properties Pvt, Tata Projects Ltd and TVS Logistics Services Ltd.