Ola Cabs has its competitor TaxiForSure in a USD 200 million deal, which is the second largest deal in the e-Commerce sector.
Bhavish Aggarwal Co-Founder & CEO Ola Cabs speaking about the deal to CNBC-TV18 said it was a cash and equity deal and would likely complete the deal within this week.
The company at present is focusing on growth but may look at IPO at some point in time, said Aggarwal.
Below is the transcript of Bhavish Aggarwal's interview with CNBC-TV18's Nayantara Rai and Kritika Saxena.
Nayantara: Can you just confirm for us what stake you are going to hold in TaxiForSure?
A: We are acquiring the complete company. So, 100 percent.
Kritika: There is Accel Partners, Bessemer Venture Partners and Helion Venture Partners which were invested in TaxiForSure, what is the stake that TaxiForSure's investors will hold in Ola after the deal is completed?
A: I can't tell you the exact number. It is a cash and equity deal. Most of the investors will get equity on Ola.
Kritika: Can you breakup the structure? How much in cash and how much in equity?
A: I can't share the exact numbers but it is a mix of both cash and equity.
Kritika: This does give you a majority versus your peers, I am assuming there is Uber and Meru which are your direct competitors. What is the size of the online market so far because the numbers have been slightly dwindling over the last couple of quarters? After the deal goes through what will be your share?
A: The overall taxi industry in India is around USD 7-8 billion annually and that is growing aggressively. The broader mobility market is even larger, it is a huge broader mobility market if you include other mobility means. The online share of that is around 5-6 percent right now. However that is increasing very fast.
Ola is the largest player, TaxiForSure is the second largest player and both Raghunandan G and I have a shared vision of how we want to grow the urban mobility opportunity in India. Raghunandan has built a great team at TaxiForSure and that is the reason we want to work together, that is the central reason we came together.
Nayantara: Going forward are you going to be looking at further acquisitions to make sure that your market share indeed stays where it is and you can grow it? The other thing I wanted to ask you was the timing of this deal. It is coming at a time when taxi aggregators, there is an overhang if I may say so on tax aggregators after the Uber rape case, lot of states had said may be they were going to ban them, not ban them, they have been making headlines for a lot of wrong reasons.
A: Safety is central focus for us. We have worked with the states across the country to implement whatever safety requirements are needed to be implemented, in some cases go much beyond that. For example all our drivers including TaxiForSure drivers are background checked, third party verified, police crime record verified, we have done all of that for all our drivers.
We have built features in our app where you have an SOS button inside the app itself. In addition to this transport being a concurrent subject each states has its own unique laws and we are working with each of these state authorities to make sure we are compliant and working with them.
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