Parent company DiDi to invest R$1bn; service to resume mid-year.
The mobility and logistics platform 99, owned by China’s DiDi, will invest R$1 billion to expand its logistics operations in Brazil and relaunch its food delivery service, 99Food, which was discontinued in 2023. The decision marks a new chapter of competition in Brazil’s meal delivery market, currently dominated by iFood.
The announcement was made by Stephen Zhu, president of DiDi’s International Business Group, during a meeting with Brazil’s Vice President and Minister of Development, Industry, Trade and Services, Geraldo Alckmin, in Brasília on Wednesday (16). According to the company, the service will gradually be rolled out to consumers, restaurants, and delivery-service workers starting mid-2025.
Since halting its food delivery operations, 99 has focused on building out its logistics services for both passenger and parcel transportation. Now operating in over 3,300 municipalities, the company plans to leverage this extensive reach to reenter the food delivery space with greater scale.
99Food originally launched in November 2019 in Belo Horizonte (Minas Gerais). By early 2022, it was active in 59 Brazilian cities across 22 states and had 114,000 registered restaurants. The platform exited the Brazilian market in 2023, following a similar move by Uber, which discontinued UberEats’ prepared food delivery service in the country nearly a year earlier.
Exclusivity contracts challenged
One of the major hurdles for competitors has been the exclusivity contracts between iFood and large restaurant chains—seen as a barrier to fair competition.
These practices were challenged before Brazil’s antitrust agency, CADE, which later imposed a consent decree on iFood. The ruling prohibited the company from signing exclusive deals with restaurant groups operating more than 30 outlets.
Since then, iFood and Colombian rival Rappi have continued to operate nationwide, with iFood experiencing exponential growth. Currently active in around 1,500 cities, iFood reports 55 million registered users, 380,000 partner establishments, and a monthly transaction volume of about R$8 billion.
In 2023 alone, iFood’s operations generated R$110.7 billion in economic activity across multiple sectors, equivalent to 0.55% of Brazil’s GDP.
Since 2022, iFood has been controlled by Dutch firm Prosus, the international investment arm of South African media conglomerate Naspers. In February this year, Prosus announced a $4.29 billion deal to acquire fellow Dutch platform Just Eat Takeaway.com, forming the world’s fourth-largest food delivery company by gross transaction value.
For Rappi, Brazil is its third most important market after Colombia and Mexico. However, the company has stated that its main focus in Brazil is ultra-fast deliveries through its Rappi Turbo service. It does not disclose figures for its Brazilian operations.
According to market intelligence firm Euromonitor International, iFood holds 70% of Brazil’s food delivery market, while Rappi accounts for just 7%. iFood disputes these numbers but has not provided alternative data. The company notes that traditional channels such as phone and WhatsApp still play a significant role.
According to Valor, the return of 99Food suggests that Brazil’s delivery market remains open to competition. Greater rivalry in the sector tends to benefit both consumers and restaurants, offering more choice and potentially better pricing.
This isn’t the first time Brazil has drawn the attention of global delivery giants. In March, Valor reported that U.S.-based DoorDash had entered talks to acquire Rappi’s global operations in 2024. The deal ultimately fell through due to disagreements over asset valuation.
More recently, reports surfaced that Chinese tech giant Meituan is preparing a possible entry into the Brazilian market. Sources say company executives have been meeting with local industry players, suppliers, and logistics operators. However, as in previous instances, there is no confirmation that Meituan will proceed with launching operations in Brazil.
Source: Valor International
