Uber, for years has spread across the globe with command-and-conquer rapaciousness, it has been reported that Uber has reached an agreement to sell its Southeast Asian ride-hailing business to rival Grab, a rival based in Singapore. On the other hand, Uber already exited its three global markets by selling it to rivals.
Previously, Uber has exit from China first in 2016 after marked an equity exchange deal with Chinese market leader Didi. Futhermore, Uber also quit from Russia last year after it sold its business in the country to local rival Yande. Southeast Asia is seen as a growth market prospect because the population there over 600 million people.
In the latest move to shore up its finances and refocus its business ahead of a planned public listing and could announce the deal as early as Monday morning in Singapore, people familiar with the matter said. Under the agreement, chief executive of Uber, join Grab’s board and would get a 27.5 percent stake in Grab. In return, Grab will acquire all of Uber’s operations in a region of 620 million people, including food delivery service UberEats.
SoftBank Group Corp., Japanese conglomerate that recently have put a big stake in Uber and became the biggest shareholder for the company. Even more, Masayoshi Son’s company adviced these companies for not spend too much money to competing against one another. Because, he has also backed a host of its competitors, including Grab in Southeast Asia, Ola in India and Didi Chuxing, who has brought Uber’s China success in 2016.
The exit of Uber from Southeast Asia has reflecting the new guidance of the company under Dara Khosrowshahi, who just replaced the previous chief Travis Kalamick. Khosrowshahi has been pushing the financials of Uber who burned through $10.7 billion since its founded, He has repaired relations with regulators, a troubled workplace culture and hushed the company’s financial anticipation in Wall Street. However, Khosrowshahi told his employees that there will be no more repeats under his leadership.
Dara Khosrowshahi personal statements on the agreement:
“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.”
For Uber, hand over Southeast Asia still leaves it with plenty of challengers elsewhere in the world. Didi Chuxing, based in Beijing, invested alongside SoftBank in Grab last year. They raised money from SoftBank and another investor at a worth of $56 billion. In other words, this amount is higher than the $48 billion where Uber was valued as part of last year’s stake sale to SoftBank.
Subsequently, Didi wants to go more globaly. The company, recently took control of 99, an Uber rival in Brazil, and is select on LinkedIn ahead of a opening plan in Mexico.
Didi is also aiming will expand soon into Japan where is it a market in which according to Mr. Khosrowshahi, Uber is also, will make a big effort this year. SoftBank, despite being an investor in both Uber and Didi, announced recently that it would partner with Didi in Japan.
Grab, started out as a taxi-shout application in Kuala Lumpur founded in 2012, became the region’s dominant mobile transportation service for the past years with $4 billion raised from investors and according to CB Insights it already valued $6 billion. With more than 86 million mobile app downloads today, it offers a wide range of ride-hailing services across Singapore, Indonesia, the Philippines, Malaysia, Thailand, Vietnam, Myanmar and Cambodia.
Anthony Tan, Group CEO and Co-founder, Grab in his personal statements:
“We are humbled that a company born in Southeast Asia has built one of the largest platforms that millions of consumers use daily and provides income opportunities to over 5 million people. 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.”
Grab’s president , Ming Maa, in an interview said that the deal with Uber would help Grab move closer to profitability, but he declined to give [specifics. Grab is generally regarded as the market leader in Southeast Asia. But in Indonesia, the region’s most populous country, it s taking on Go-Jek, a local rival whose apps offer services, such as massages on demand and motorbike parcel deliveries, that go beyond just rides. Go-Jek’s investors include Google and Tencent, the Chinese internet conglomerate.
With passengers in nearly 200 cities across the region, the company is aimed to be not just a transportation provider only but also as a digital wallet. Grab introduce GrabPay, to replace cash as a way to pay for things at offline shops and restaurants. Moreover, Grab also offers a lots variety of ways for people to get around. In Singapore, Grab introducing GrabShuttle that like a public bus, it will take you between points along a fixed route. As well, for jam-packed in Jakarta, you can use Grab’s application to booking a motorbike taxi right off the street nearby.
Many consumers in the Southeast Asian region may be concerned at the end of the competition between the two companies, and there isn’t much time left. Also, Grab said that Uber’s ride-sharing app will be available for a further two weeks, while Uber Eats will close do (Reuters, 2018)wn and migrate to GrabFood at the end of May. Speaking for this, for all Uber employees in its Southeast Asia, a Grab spokes woman said their operations would be offered employment in Grab.