Uber Freight, the rideshare company’s trucking division, said Thursday it’s acquiring shipping software company Transplace in a deal that values the transportation logistics company at $2.25 billion.
Uber shares were slightly positive Thursday morning.
Uber Freight will acquire Transplace from TPG Capital, the private equity platform of alternative asset firm TPG that acquired Transplace in 2017. The deal consists of of up to $750 million in common stock of Uber and the remainder in cash.
It’s a rare move for Uber, which has spent the last year shedding its profit-eating self-driving unit and flying taxi segment. Instead, Uber has been choosing to pour billions into strengthening its Uber Eats segment, acquiring alcohol delivery company Drizly and food delivery service Postmates.
Uber Freight chief Lior Ron said in an interview on CNBC’s “TechCheck” that the deal is a continuation of the company’s long-term vision, which is to bring digital transformation to the industry. Transplace makes software that helps companies manage their supply chains to ship goods. The company claims it operates one of the largest software platforms for supply chain management and logistics in the world.
Uber Freight, a separate division of Uber, offers similar software tools to manage supply chains and shipping. Uber Freight says it has over 70,000 carriers on its network that can ship items for companies.
Uber Freight booked $301 million in revenue in the first quarter of this year, up 51% year over year. Despite the growth, Uber Freight contributes just a small slice of Uber’s overall revenue, the bulk of which comes from rides and food delivery.
The deal is expected to help Uber’s trucking division reach profitability. The company said it could help the segment break even on an adjusted EBITDA basis by the end of 2022.
The deal is still subject to regulatory approval.
This article originally appeared on CNBC