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Stock Alert: Uber Shares Climb Following Acquisition

Shares of Uber Technologies, Inc. (UBER) jumped 7% on Tuesday after the company announced that its food delivery business in India is acquired by Zomato, one of the biggest food delivery apps in the country.

The stock recorded a high of $37.80 before closing at $37.60. UBER has been trading in a range of $25.58- $47.08 in the past one year.

Zomato, whose major investors include Alibaba's affiliate Ant Financial, bought Uber Eats in an all-stock transaction, that gives Uber 9.99% ownership in Zomato.

Early this month, Uber had acquired Careem Networks FZ-LLC, a ride-hailing service provider in the greater Middle East region with major markets including Egypt, Jordan, Saudi Arabia, and the United Arab Emirates.

Uber is stepping into grocery delivery space by buying majority ownership of Cornershop, a leading online grocery provider in Chile, Mexico, and more recently in Peru and Toronto. The deal, which was announced in October last year is expected to close in the first half of 2020.

In the third quarter ended September 30, 2019, revenue grew year-over-year to $3.813 billion from $2.944 billion. However, Uber had a net loss of $1.162 billion or $0.68 per share in the third quarter compared with net loss of $986 million or $2.21 per share in the same quarter a year ago.

The company is expected to report earnings on February 6, after market close.

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