It is no longer news that the ride-hailing giants has businesses in most part of the world including Southeast Asia , but the news is that Uber today Monday, signed a deal to sell its business to SouthEast Grab, it’s rival in the region.
As part of the procurement, Uber will take a 27.5 percent stake in Grab, with Uber CEO Dara Khosrowshahi joining Grab’s board.
Grab will take over all of Uber’s businesses, including its ride-sharing, food delivery and payments and financial services in Cambodia, Indonesia, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam, according to a statement.
Asia isn’t the first place Uber is retreating. The ride-hailing company sold its operation in China to Didi Chuxing its rival, which is one of the country’s biggest ride sharing provider, in August 2016. Rumours about Grab’s acquisition have been swirling since Softbank an investor with Grabs confirmed its investment in Uber last December.
Grab has raised more than $4 billion to date and was last valued at $6 billion. Beyond its car and taxi-hailing services, the company also has a payments platform called GrabPay and recently launched a financial services platform. As part of the merger, Grab will also be acquiring Uber’s food-delivery business, UberEats, in Southeast Asia.
Khosrowshahi wrote in an email to Southeast Asia employees:
“I’m conscious that much of the hard work happened before I arrived, and I want to recognize the operations you have built across these eight countries and “After investing $700 million in the region, we will hold a stake worth several billion dollars, and strategic ownership in what we believe will be the winner in an important global region.
Khosrowshahi also added that the transaction between the two companies, will help the company focus on the core markets like India, Latin America and the Middle East. Khosrowshahi wrote:
“It is fair to ask whether consolidation is now the strategy of the day, given this is the third deal of its kind, from China to Russia and now Southeast Asia, “The answer is no. One of the potential dangers of our global strategy is that we take on too many battles across too many fronts and with too many competitors. This transaction now puts us in a position to compete with real focus and weight in the core markets where we operate, while giving us valuable and growing equity stakes in a number of big and important markets where we don’t.”
Grab has long touted its hyper-local advantage over Uber. Their deep knowledge of the nuances of each of the eight countries arguably has helped the company expand outside of car and taxi-hailing, into more diverse services like payments and financial services. This merger is an indication that Uber recognised that advantage Grab has over them.
To provide the best experiences, we use technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behaviour or unique IDs on this site. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional
Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes.The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
