Travis Kalanick’s CloudKitchens Said to Delay Mideast Unit’s IPO - Bloomberg

Travis Kalanick’s CloudKitchens Said to Delay Mideast Unit’s IPO - Bloomberg

CloudKitchens, a startup run by former Uber Technologies Inc. Chief Executive Officer Travis Kalanick, has delayed plans to list its Middle Eastern business, according to people familiar with the matter.

The ghost kitchen company, which is backed by Saudi Arabia’s sovereign wealth fund, is instead planning to focus on options including a private placement, some of the people said, requesting anonymity to discuss confidential information.

CloudKitchens had been eying a dual-listing in Abu Dhabi and Saudi Arabia which was expected as early as 2026, Bloomberg News previously reported. Banks including Goldman Sachs Group Inc., JPMorgan Chase & Co., SNB Capital and First Abu Dhabi Bank PJSC were working with the firm on the first-time share sale.

The plans for a listing could be revived at some point after the potential private placement is concluded, but there is no definite timeline, according to some of the people.

The company had been targeting an IPO valuation of roughly $2 billion and had begun preliminary discussions with public-market investors, the people said.

Representatives for CloudKitchens did not respond to requests for comment.

After four standout years, the Middle East’s IPO boom is slowing down amid tougher valuation demands from investors and a revival of share sales in the US and Asia.

Listing proceeds in the Gulf have slipped to roughly $6 billion this year, less than half the level a year ago and the weakest since the pandemic. The slump is most pronounced in Saudi Arabia, where lower oil prices are fanning concerns of a slowdown in government spending and dragging on stocks. The kingdom’s main stock index is among this year’s laggards in emerging markets, and a majority of the year’s debuts are trading below offer.

Ghost kitchens - shared cooking sites built for delivery - first appealed to startups seeking a low-cost way onto delivery apps. The model boomed during the pandemic as bigger restaurant groups tested it to offset lost dine-in sales, though many of those efforts have since faded.

CloudKitchens has strong ties to the Middle East, with its regional arm incorporated in Abu Dhabi and a $400 million investment from Saudi Arabia’s Public Investment Fund in 2019. Founder Travis Kalanick was already known to the PIF, which put $3.5 billion into Uber a year before his 2017 ouster.

It rents kitchen space to restaurants and adds services like delivery coordination and maintenance. In the Middle East’s crowded delivery market, it operates KitchenPark sites across the UAE, Saudi Arabia and Kuwait.