Singapore-based Cab hailing startup Grab is learnt to raise a whopping $2 Billion from SoftBank and Chinese counterpart Didi Chuxing. Considered as the biggest rival of Uber in Southeast Asia, Grab could see Alibaba’s head Jack Ma in the investment round as per Bloomberg Report.
Grab has been in discussions with potential investors to raise money for a number of months but this time it hit on the money. Grab operates its ride-hailing platform in 55 cities across seven countries, raised $750 million in a funding round in September 2016, with sources then valuing the five-year-old startup at over $3 billion.
The latest funding will make Grab, more than a $5 Billion valued company, which transitioned itself into a consumer technology firm that also offers loans, electronic money transfer and money-market funds.
Grab which recently announced to expand its service to seventh country in the region is ahead of Uber and Go-Jek of Indonesia, where it has pledged $700 million in investment in the next four years, seeking to win over a market with 260 million people. Indonesia is Grab’s largest market, where the four-year-old company registered more than 600 percent growth last year.
The deal is expected to close in the next few weeks and it comes amid struggling days of Uber, which has been in the news from sexual harassment to dramatic ouster of its co-founder and CEO Travis Kalanick.
Importantly, the news of the expected deal surfaced at a time when Uber just announced retreat from Russia via merging its operation with continent’s Internet giant Yandex. The $2 billion cheque will give ambitious fire-power to counter Uber and Go-Jek in existing cities and continue building fin-tech portfolio.
If the round goes though, it will also have positive impact towards India where home-grown ride-hailing unicorn – Ola is engaged in fierce fight with Uber. The Bengaluru based company’s loss rose to almost three times (from Rs 2,313.66 crore in FY16 compared from Rs 796 crore to previous year) as it splurged heavily on defending onslaught from Uber.
Ola needs more capital to keep fighting Uber in India and since SoftBank is leading fresh round in Grab, which is also a common investor in Ola, chances of getting it more capital from Masayoshi Son led investment firm is more likely.
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