Apple was in discussions recently to buy a stake in Lyft as part of a “strategic partnership,” which could pose a domestic threat to Uber, says the New York Post, citing sources familiar with the matter. It is not yet certain if the talks are still ongoing, and there is no information on the size of Apple’s potential investment in the number 2 ride-hailing app in the United States.
No acquisition talks between Apple and Lyft
Talks about the possible partnership with the Cupertino-based giant were mostly focusing on making a possible competitive and operational alliance, the report stated. The discussion was not part of Lyft’s exploration of strategic alternatives this summer, the report says, citing sources. This exploration process was reportedly led by Qatalyst Partners, an investment bank.
“M&A was not discussed at all,” a source familiar with the matter told the Post. “There’s no interest from Apple or Lyft in an acquisition.”
Lately Lyft has been fighting speculations that it is searching for a buyer, as Uber – after the sale of its Chinese operations to Didi – has more cash to compete with Lyft in the U.S.
On Sunday, denying any possibilities of a sale, a spokeswoman said, “Lyft is not for sale, we are on a fully funded path to profitability.”
The ride-haling app is not in any danger as it has a cash safety of $1.4 billion.
Apple could make things tough for Uber
Apple’s talks with Lyft were the most recent sign that the iPhone maker is preparing for what could be a worldwide battle with Uber. One of the sources told the Post that Qatalyst talked to the iPhone maker about a possible Lyft acquisition. It also reportedly brokered talks with other prospective acquirers including General Motors, Amazon and Google, the report states. Lyft’s board reportedly initiated the talks after it received some interest from GM, but it did not result in any serious merger discussions.
The operational tie-up said to be discussed by Lyft and Apple was similar to the one in which the latter company took a $1 billion stake in Chinese ride-sharing giant Didi Chuxing in July. This deal, according to some industry insiders, was the key factor behind Uber’s decision to give up its aspirations in China and merge its operations there with Didi’s. The deal has been valued at $26 billion.
Similarly, a situation in which Apple becomes a deep-pocketed backer of Lyft could alter the competitive equation for Uber in the U.S., the report notes.