Uber sells to rival Grab
TWO of the biggest ride-hailing apps in Asia are joining forces.
Grab announced on Monday, March 26, that it acquired Uber's Southeast Asia operations. They are calling the deal "the largest ever of its kind in Southeast Asia."
Grab will integrate Uber's ridesharing and food delivery business in the region into Grab's existing multi-modal transportation and fintech platform.
"With the combined business, Grab will drive towards becoming the #1 online-to-offline (O2O) mobile platform in Southeast Asia and a major player in food delivery," Grab said in a statement.
Aside from transport, Grab's services include food and package delivery, mobile payments and financial services.
Grab will take over Uber's operations and assets in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. As part of the acquisition, Uber will take a 27.5 percent stake in Grab while Uber CEO Dara Khosrowshahi will join Grab's board.
"This deal is a testament to Uber's exceptional growth across Southeast Asia over the last five years. It will help us double down on our plans for growth as we invest heavily in our products and technology to create the best customer experience on the planet. We're excited to take this step with Anthony and his entire team at Grab, and look forward to Grab's future in Southeast Asia," said Khosrowshahi.
Reports of a merger between the two rivals have been circulating for months.
Stiff competition has led to both having to offer discounts and promotions to both drivers and passengers to ensure more users.
Uber has also been letting go of operations in China and Russia to other companies. It has also suffered several setbacks, from reporting losses to losing its former CEO due to a harassment scandal. It was also in the headlines recently after its self-driving car killed a pedestrian in a car crash in Arizona.
For Grab, the acquisition will allow them to expand GrabFood in Singapore and Malaysia, after they integrate Uber Eats into the business.
"Today's acquisition marks the beginning of a new era. The combined business is the leader in platform and cost efficiency in the region.
Together with Uber, we are now in an even better position to fulfil our promise to outserve our customers. Their trust in us as a transport brand allows us to look towards the next step as a company: improving people's lives through food, payments and financial services," said Grab CEO and co-founder Anthony Tan.
"We will rapidly and efficiently expand GrabFood into all major SEA countries in the next quarter. We're going to create more value for our growing ecosystem of consumers, drivers, agents - and now merchants and delivery partners. GrabFood will also be another great use case to drive the continued adoption of GrabPay mobile wallet and support our growing financial services platform," added Grab co-founder Tan Hooi Ling.
They expect GrabFood to be available across all major Southeast Asian countries by the first half of 2018.
Aside from growing its existing transport network, it announced offering a GrabCycle marketplace for shared bicycles and personal mobility devices, and GrabShuttle Plys for on-demand bus routes.
They will also be working to migrate Uber's customers, drivers, merchants and delivery partners into the Grab platform while the Uber app will continue to operate for two weeks "to ensure stability for Uber drivers" and give them time to sign up to drive with Grab online. (MEA/SunStar Cebu)