Uber Expands Logistics Business... Acquires Freight Truck Management Company 'Transplace'

[Photo by Reuters-Yonhap News]

[Asia Economy Reporter Byunghee Park] Uber, the largest ride-hailing service provider in the United States, is acquiring the freight truck management software company 'Transplace' from the private equity firm TPG Capital.

According to the Wall Street Journal (WSJ) on the 22nd (local time), Uber plans to pay TPG Capital an acquisition price of $2.25 billion (approximately 2.587 trillion KRW). Of the acquisition price, $750 million will be paid in Uber common stock, and the remaining approximately $1.5 billion will be paid in cash through bond issuance.

Based in Dallas, Texas, Transplace was formed in 2000 through the merger of six trucking freight companies. Its major clients include consumer products maker Colgate-Palmolive, food company Del Monte, and automotive parts manufacturer Eaton.

With the acquisition of Transplace, Uber is expanding its logistics business. Uber currently operates its freight division, 'Uber Freight,' which accounts for a small portion of its overall business. Evan Armstrong, president of logistics industry research group Armstrong & Associates, estimated that this acquisition will elevate Uber Freight to become the 8th largest third-party freight company in the U.S., with revenues reaching $4.4 billion.

Due to the COVID-19 pandemic causing travel and business trips to halt, Uber's core ride-hailing service business has suffered significant setbacks.