US-based Uber Technologies has agreed to acquire Dubai-headquartered ride-hailing company Careem for $3.1bn, consisting of $1.7bn in convertible notes and $1.4bn in cash.

The acquisition, subject to applicable regulatory approvals, is expected to close in the first quarter of 2020, the companies said in a statement.

Upon closing, Careem will become a wholly owned subsidiary of Uber, preserving its brand.

“Uber will acquire all of Careem’s mobility, delivery and payments businesses across the greater Middle East region … with major markets including Egypt, Jordan, Pakistan, Saudi Arabia and the UAE,” the statement said.

It is understood Careem co-founder and CEO Mudassir Sheikha will lead the Careem business, which will report to its own board made up of three representatives from Uber and two representatives from Careem.

The local subsidiary of US-based Jefferies acted as exclusive financial adviser to Careem on the transaction.

The sale is the largest ever technology-related transaction in the Middle East region. In 2018, the US’ Amazon acquired Dubai-based online retail platform for $650m.

This article has been unlocked to allow non-subscribers to sample MEED’s content. MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s Middle East business intelligence, subscribe here