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Uber and DoorDash reportedly held failed talks to merge last year

Dara Khosrowshahi, chief executive officer of Uber Technologies Inc., speaks on a webcast during the company’s initial public offering (IPO) on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Friday, May 10, 2019.Michael Nagle | Bloomberg | Getty ImagesUber and DoorDash explored the possibility of a merger last year,…

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Published on January 30, 2020

Dara Khosrowshahi, chief executive officer of Uber Technologies Inc., speaks on a webcast during the company's initial public offering (IPO) on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Friday, May 10, 2019.

Michael Nagle | Bloomberg | Getty Images

Uber and DoorDash explored the possibility of a merger last year, but ultimately the discussions did not result in a deal, the Financial Times reported Thursday.

Uber shares dropped slightly after the FT published its report. Shares were down about 1% late Thursday morning.

SoftBank urged Uber and DoorDash to discuss a potential merger, the FT reported, citing sources familiar with the discussions. Although conversations fell apart, the companies have not ruled out the idea of resuming talks, according to the FT.

Representatives from Uber and DoorDash declined to comment.

SoftBank has invested heavily in both companies through its Vision Fund. Last November, DoorDash raised a new round of funding that values it at close to $13 billion, after raising $600 million last May in a funding round from SoftBank and other investors.

Uber Eats has struggled to become profitable, despite seeing double-digit revenue growth year over year in Uber's most recent earnings report. Last week, Uber sold its food-delivery business in India to its competitor Zomato. Uber also exited its Eats business in South Korea last September.

The market for food delivery services has proven competitive, with Uber Eats, DoorDash, Postmates, Grubhub and others all jockeying for customers' wallets. Venture capitalists have been pouring money into start-ups like Postmates and DoorDash, but many of them have struggled to generate a profit. Grubhub, the only profitable delivery service, is reportedly exploring strategic options, including a possible sale.

Read the full report from the Financial times here.