Uber Technologies Inc. is aiming to consolidate its international operations ahead of an initial public offering, with the ride-hailing giant said to be in talks with Middle Eastern startup Careem Networks FZ.

Bloomberg reported that the companies are in preliminary talks about a deal. Options on the table include Uber merging its Middle Eastern operations with Careem in return for Uber taking a majority stake in the company, or alternatively Uber acquiring the company outright.

Founded in 2012 in Dubai, Careem operates 80 cities in 13 countries across the Middle East, North Africa and South Asia and had a valuation of $1.2 billion as of September. With reported 30 percent month-on-month growth, that figure is likely to be higher 10 months later. Careem is rumored to be discussing a new round of funding on a $1.5 billion valuation.

Market share for Careem versus Uber is hard to pin down. In March last year, the company was claimed to be the largest in the Middle East, with 6 million customers and a network of 150,000 drivers, and Bloomberg noted that it’s the market leader in most countries in which it operates.

How much market share Careem holds is relevant to any deal given that Uber has previously exited countries and regions only where it had lost against local companies. Those exits include Uber selling its Southeast Asian business to Grab Taxi Pte. Ltd. in March in return for a 27.5 percent stake; its business in Russia and a number of former Soviet republics to Yandex Europe AG in return for a 36.6 percent stake in July 2017; and its Chinese business to Didi Chuxing Technology Co. in return for a 20 percent stake in August 2016.

That Uber is considering only doing a deal in return for a majority stake or even considering buying Careem outright would suggest that though Careem may be the market leader in its region, the margin between the companies may not be that great.

Careem has raised $571.1 million from Rakuten, Daimler, DCM Ventures and Coatue Management.

Photo: Zizolo0ol/Wikimedia Commons