Skip to main content

Santiago-based Cornershop operates in Mexico, Chile, Canada and Peru, but chief executive Oskar Hjertonsson said the deal would allow it to deliver groceries 'in many more countries around the world.'

RODRIGO GARRIDO/Reuters

Uber Technologies Inc said on Friday it would buy a majority stake in Chilean online grocery provider Cornershop as the ride hailing company seeks to widen its fast-growing food delivery app to include groceries and other goods.

The deal for an undisclosed sum, which follows Uber’s disappointing IPO in May, would see it expand Santiago-based Cornershop, which now operates in Mexico, Chile, Canada and Peru into “many more countries around the world,” Cornershop Chief Executive Oskar Hjertonsson said.

The app provides delivery of “groceries to your front door in one hour” from retailers including Costco Wholesale Corp, Walmart Inc and Mexico’s Chedraui.

Story continues below advertisement

“Whether it’s getting a ride, ordering food from your favourite restaurant, or soon, getting groceries delivered, we want Uber to be the operating system for your everyday life,” Uber CEO Dara Khosrowshahi said in a statement.

He tweeted an image suggesting Uber would launch a rebranded app using its existing format, potentially encompassing all its services including taxis, bicycles, groceries and restaurant deliveries.

Uber said it expected to close on its Cornershop purchase in early 2020, “subject to regulatory approval.”

An Uber spokesman said the company expected regulatory checks in both Mexico and Chile. He said Uber viewed Cornershop as “a concrete example” of Khosrowshahi’s new strategy to “provide solutions to solve problems in people’s daily lives.”

Both Uber and Cornershop declined to comment further.

Nathan Lustig, a managing partner of Magma Partners, a seed stage venture capital fund for tech firms in Latin America, said Uber seemed to be gearing toward “super-app” status similar to Tencent Holdings’ WeChat and Rappi, backed by Softbank.

Rappi has expanded at a breakneck pace in Latin America, with its restaurant delivery service emerging as a key competitor for Uber Eats.

Story continues below advertisement

Mexican antitrust officials earlier this year blocked a $225 million bid by Walmart to buy Cornershop, citing concerns the retail giant could not guarantee a level playing field for rival retailers.

Lustig said Cornershop had expanded rapidly since the Walmart deal fell through, resulting in a likely higher price tag for the Uber deal.

“I believe they grew the business multiple times since Walmart’s deal was first announced,” he said. “Cornershop’s tech and ideas work globally, so it’s not just a Latin American bet.”

In a statement, Uber said Cornershop would continue to operate under its current leadership, reporting to a board with majority Uber representation.

Cornershop has rapidly gained popularity in local markets, including Chile, where its uniformed staff are a common sight in the aisles of grocery stores hunting down orders for customers, before delivering them in branded, recyclable bags.

News of the deal comes amid a flurry of similar announcements from Uber, as it seeks to expand beyond its core taxi app.

Story continues below advertisement

Uber shares rose 4.8% in New York trading, although it was unclear whether the gains were related to the Cornershop move.

This week Uber launched a boat service in Nigeria’s populous Lagos, expanded a helicopter taxi service in New York’s JFK airport and began an app in Chicago to connect workers with businesses needing to fill available shifts.

Increased diversification comes as Uber’s main ride hailing operations face mounting competition in Asia, and heightened U.S. regulatory scrutiny over the classification of its drivers as independent contractors.

Report an error
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter
To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies