Brazil-based food delivery service iFood announced this week it had purchased a controlling stake in Colombian service Domicilios.com, according to TechCrunch. The deal gives iFood a 51 percent equity stake the partnership, while Delivery Hero, which owns Domicillios.com, holds the remainder. Financial terms were not disclosed.
Behind the purchase is iFood’s ambitions to compete more fiercely with Softbank-backed delivery service Rappi, which is based in Bogota, Colombia and currently holds the top spot in terms of market share in that country. The iFood-Domicilios.com merger gives iFood a larger geographic presence in Colombia — over 12,000 restaurants across 30-plus cities. It also brings the battle for food delivery dominance to Rappi’s home turf.
Prosus-backed iFood has raised nearly $600 million to date. Rappi has raised over $1 billion. Both companies also compete in the region with Uber Eats.
Carlos Moyses, iFood’s corporate vice president for Latin American operations, said in a statement that the company hopes to expand beyond its current markets of Colombia, Mexico, and Brazil. “We are growing faster than anybody else in LatAm.”
Meanwhile, the Latin American market is the fastest-growing one for food delivery outside of the Asia-Pacific region, with sales from delivery quadrupling between 2014 and 2019. And with the coronavirus expected to hit the region especially hard, competition for customers is likely to intensify even more as the population hunkers down.
Fabricio Bloisi, iFood’s CEO, said Colombia, in particular, was a “strategic country” for the service, hence the merging with a service headquartered in that country. As for the rest of Latin America, this new consolidation should ensure competition is more fierce than ever when it comes to gaining and retaining customers.
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