Following the acquisition of the app Postmates last year, Uber announced Tuesday that it is acquiring the alcohol-delivery service Drizly for $1.1 billion to further bolster Uber Eats’ offerings. The company said that the transaction would be completed by the first half of this year, and that 90% of the consideration to be paid to Drizly Shareholders would be in shares of Uber stock and the remaining in cash. Reports also mentioned that the co-founder and CEO of Drizly, Cory Rellas is expected to remain with Uber in an executive role.

Uber eats has been expanding to different sections like groceries, medications and with this acquisition, alcohol. Drizly will be integrated into Uber Eats, but also remain a standalone app for the time being.

Drizly like Uber Eats, deals with local merchants, and delivers to doors.

Both Uber Eats and Drizly saw an unprecedented growth last year, owing to the COVID-19 lockdown. With people not stepping put of their houses as much as possible, and the closing of food and liquor houses alike, the two apps have been used to order them online. Founded in 2012, Drizly has risen to the top in on-demand delivery services in the States while Uber Eats has become one of the biggest food delivery apps in the world.

This merging of the two will prove beneficial for both the apps. Uber will be able to benefit from the market that Drizly has been able to create for itself, with the company’s services reaching more than 1,400 cities in North America. On the other hand,  Drizly will benefit from Uber’s underlying ride hailing and delivery technologies.

Preceding this, Uber had offloaded some of its more cost-eating transportation services. Last May, it transferred Hump-its electric bike and scooter business- to Lime, and sold its self-driving unit, Advanced Technologies Group to Aurora Innovation in December.
With this merger, the two services are expected to grow just as much in 2021- if not more than 2020.