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Uber acquires public transportation software company in latest transit expansion

Credit: REUTERS/CALLAGHAN O'HARE

Uber Technologies Inc on Thursday announced the acquisition of transit software provider Routematch, marking the ride-hailing company's latest move toward expanding its business with public transportation agencies.

By Tina Bellon

July 16 (Reuters) - Uber Technologies Inc UBER.N on Thursday announced the acquisition of transit software provider Routematch, marking the ride-hailing company's latest move toward expanding its business with public transportation agencies.

Uber, which has gradually deepened its collaboration with agencies over recent years, last month announced its first software-based transit deal with an agency in the San Francisco Bay Area.

Thursday's acquisition allows Uber to rapidly expand its transit agency customer base, but also combine the routing, matching and on-demand technology both companies have developed.

"This lets us go so much further so much faster in being able to power public transit agencies," David Reich, Uber's head of transit, said in an interview on Wednesday.

Atlanta-based Routematch provides technology to some 550 transit agencies in North America and Australia for fixed-route operations, including payment processing, fleet management, route planning, tracking and scheduling.

Founded in 2000, the company also operates transit agencies' on-demand scheduled services for wheelchair-accessible or non-emergency medical transportation.

The companies declined to provide financial details on the acquisition or Routematch's business. Routematch's roughly 175 employees are all expected to join Uber, the company's chief executive, Pepper Harward, said.

Harward said Uber's presence has challenged transit agencies over the past few years by increasing customer's expectations for the convenience and speed of a spontaneous trip - prompting many to look for more dynamic, on-demand transportation alternatives.

While nothing will change immediately for Routematch's existing transit customers, Harward and Reich said the companies were looking at ways to combine Routematch's technology for fixed-route and paratransit services with Uber's ride-hailing app down the line.

Uber, long criticized by some transit officials for siphoning off riders from public transit, hopes the acquisition will show agencies it is serious about collaborating.

"We are that much more credible now that we have Routematch," Reich said.

(Reporting by Tina Bellon in New York; Editing by Leslie Adler)

((Tina.Bellon@thomsonreuters.com; +1 646 573 5029; Reuters Messaging: tina.bellon.thomsonreuters@reuters.net; Twitter @TinaBellon))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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