Global ride-hailing company Uber has finally sold its South East Asia business to the Singapore-based company reportedly in exchange for a 27.5 per cent stake. This is the second defeat for the San Fransico-based company in the Asian market after surrendering business to Didi Chuxing in China.
Both SoftBank-backed firms would collectively give a serious challenge to one of the market leaders in South East Asia Go-Jek. The latest consolidation also hints at Uber’s probable pull out from other countries including India, where it has been facing a tough time because of Ola.
Notably, Softbank is a common investor in Uber and homegrown ride-hailing Ola.
The development, however, comes months after Uber had closed a staggering $7 billion funding from SoftBank and Grab’s $2.5 billion from Japan’s tech titan and Didi Chuxing in July last year.
Grab operates in private car, motorbike, taxi and carpooling services more than 100 cities across seven countries including Indonesia, Malaysia, the Philippines, Singapore amongst others in Southeast Asia, where it claims to have 95 percent market share.
Under the agreement, Grab will acquire all of Uber’s operations in a region of 620 million people, including food delivery service UberEats. Apart from the aforementioned stakes, Uber CEO Dara Khosrowshahi will join Grab’s board, which was last valued at an estimated $6 billion.
After SEA region, India is the only hope for Uber, besides the local market (the U.S.A). Even in India, things aren’t looking bright for Uber as local major Ola has scored a substantial 16 percent lead over former in terms of market share.
On his maiden India visit Khosrowshahi said that selling Uber business to Ola is not going to happen so, however, he admitted Ola’s supremacy in India.
“It will help us double down on our plans for growth as we invest heavily in our products and technology,” said Khosrowshahi on the latest business handover to Grab.
The news is sourced from Reuters.