Uber confirms sale of SEA business to Grab
KUCHING: Uber Technologies Inc (Uber) has confirmed the sale of its Southeast Asian ride-hailing business to rival Grab yesterday in a move that will affect 500 of its staff in the region.
Singapore-based Grab is taking over the ride-sharing and food delivery operations of Uber in the region, with the California-headquartered company to receive a 27.5 per cent stake in the business in return.
“Dear team, I wanted to let you know that we have reached an agreement to combine our business in Southeast Asia with Grab. In exchange, Uber will get a 27.5 per cent stake in the combined company. Around 500 colleagues across the region will transition to Grab, and over the coming weeks we will help our customers move to Grab’s apps,” revealed Uber chief executive officer Dara Khosrowshahi in an email to staff released on its website yesterday.
“Our journey in Southeast Asia started in Singapore almost five years ago. 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.
“After investing U$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.”
In the email, Khosrowshahi expressed his belief that “combining forces with Grab is the right thing to do for Uber for the long term.”
“Our growth and success in Southeast Asia would not have
Dear team, I wanted to let you know that we have reached an agreement to combine our business in Southeast Asia with Grab. In exchange, Uber will get a 27.5 per cent stake in the combined company.
been possible without this amazing team. Your efforts to bring the benefits of ridesharing to millions of people across Singapore, Malaysia, Indonesia, the Philippines, Thailand, Vietnam, Cambodia and Myanmar have changed lives and transformed cities for the better – and this transaction doesn’t change that history.”
Uber faces fierce competition in Asia, not only from Singaporebased Grab but from Ola in India, and Chinese rival Didi Chuxing.
Southeast Asia’s top ride-hailing firm Grab launched services in the Cambodian capital Phnom Penh late last year as it looked to lock down regional domination against main rival Uber.
Grab, which launched in 2012, has poured money into expanding its regional fleet and now has more than 2.1 million drivers in Singapore, Indonesia, the Philippines, Malaysia, Thailand, Vietnam, Myanmar and Cambodia.
While ridesharing giant Uber is the largest firm of its kind with a presence in more than 600 cities, the US-based company has been rocked by scandals and is facing fierce competition from rivals in Asia and Europe.
Meanwhile, Grab co-founder Tan Hooi Ling said after this move, the group will rapidly and efficiently expand GrabFood into all major Southeast ASian countries in the next quarter.
“We are going to create more value for our growing ecosystem of consumers, drivers, agents – and now merchants and delivery partners,” Tan said in a separate statement.
“GrabFood will also be another great use case to drive the continued adoption of GrabPay mobile wallet and support our growing financial services platform.”
Dara Khosrowshahi, Uber chief executive officer