Uber Is Selling Southeast Asian Operations to Ride-Hailing Rival Grab

Uber Is Selling Southeast Asian Operations to Ride-Hailing Rival Grab

The deal enables Uber to keep a foothold in the increasingly affluent market of 640 million people while cutting its losses.

The sale of Uber's regional business marks the first major consolidation efforts among ride-hailing companies in Southeast Asia.

The market spans Indonesia, Malaysia, Singapore, the Philippines, and Myanmar.

Under the new deal, Uber will have a 27.5 percent stake in the Singapore-based Grab and Uber's CEO, Dara Khosrowshahi will become a member of Grab's board.

Uber is giving up on the Southeast Asian market and selling their entire business to ride-sharing rival Grab.

Uber's Khosrowshahi said the deal would "help us double down on our plans for growth as we invest heavily in our products and technology".

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"One of the potential dangers of our global strategy is that we take on too many battles across too many fronts and with too many competitors", he added.

Uber has completed 5 billion trips worldwide serving 40 million riders in total by 2 million drivers. The value of the deal has not been disclosed yet. The San Francisco-based company sold its Chinese arm to local etaxi giant Didi Chuxing in a $35 billion deal back in 2016, which was followed by a merger with Yandex.taxi in Eastern Europe previous year. "On the part of Grab, we are committed to try and find everyone a home at Grab", she said.

On the other hand, Grab gets to expand on its meal delivery service being merged with Uber Eats. Grab marked a major milestone previous year, completing its one billionth ride in Southeast Asia, with its app now being downloaded in 90 million mobile devices.

Maybank Kim Eng and Credit Suisse also said in their reports earlier this month before the Grab-Uber merger was announced that ComfortDelGro would benefit from a rationalisation of competition.

Grab said in its FAQ that because Uber passengers will now be transiting to the Grab platform, this means there'll be more passengers, less waiting time and more earnings for drivers. This exit may suggest that Uber is depending on its success in North America markets and would not put up similar fights outside its local base.

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