U.S.-based restaurant listing platform Yelp, has today gulped up Eat24, one of the largest food delivery networks in the U.S., for a staggering $134 Million. Yelp is the same U.S. rival, which India-born Zomato aims to take on through its recent $52 Million UrbanSpoon acquisition.
The deal, which involves $75 Million in cash and the rest in the form of Yelp shares, will mark the second significant consolidation push in the online food delivery segment. Rocket Internet, just a few days back, made as many as 7 acquisitions in Asia through FoodPanda, along with a 30% stake in DeliveryHero, to consolidate its online food delivery network.
However, this deal is definitely being closely watched by Indian-born Zomato, which marked a rather heroic entry into the U.S. market this year, by acquiring Yelp-rival UrbanSpoon, for a record $52 Million. This amount, apart from being the biggest ever spent by an Indian start-up for a foreign acquisition, also ate up almost 85% of Zomato’s previously raised $60 Million round.
However, this isn;t just about local restaurant discovery anymore. While Zomato is yet to reap in benefits of its UrbanSpoon acquisition, Yelp acquiring Eat24 signals towards the former getting deeper into the food delivery business. While Yelp already has a massive restaurant listing platform, getting Eat24 onboard will help Yelp offer an all-in-one solution to its users.
Eat24 currently has about 20,000 restaurants on its platform across 1,500 cities while Yelp has a huge 135 million average monthly user-base, with 72 million average monthly uniques on mobile. Those two combined, will form a formidable line-up, giving a tough competition to not only Zomato, but also to the likes of Google and Facebook, who have been trying hard to set foot in local listings business.
Yelp recently beat Wall Street expectations in its Q4 earnings call, by reporting a net income of $32.7 million. Active local business accounts stand at 93,700, and local advertising accounts are 84,000. As for the number of restaurants, Yelp currently has over a Million eat-joints listed on its platform, with more getting added everyday.