In the most valuable deal of its kind in history, and what must surely be a blow to the America transport giant’s aspirations, Grab will integrate Uber’s ridesharing and food delivery business in Southeast Asia into Grab’s existing transportation and fintech platform.
The Grab app, already in 195 cities in eight Southeast Asian countries, will use this acquisition to drive towards becoming the #1 online-to-offline (O2O) mobile platform in Southeast Asia and a major player in food delivery.
Grab, used by over 5 million people daily, takes over Uber’s operations and assets in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. As part of the acquisition, Uber will take a 27.5% stake in Grab, and Uber CEO Dara Khosrowshahi will join Grab’s board.
“We are humbled that a company born in SEA has built one of the largest platforms that provides income opportunities to over 5 million people”
Anthony Tan, group CEO and co-founder, Grab said, “We are humbled that a company born in SEA 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.”
Tan Hooi Ling, cofounder, Grab said, “We will rapidly and efficiently expand GrabFood into all major SEA countries in the next quarter. We’re going to create more value for our growing ecosystem of consumers, drivers, agents – and now merchants and delivery partners. GrabFood will also be another great use case to drive the continued adoption of GrabPay mobile wallet and support our growing financial services platform.”
“This deal… will help us double down on our plans for growth”
Dara Khosrowshahi, CEO of Uber added: 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.”
Grab and Uber are working together to migrate Uber drivers and riders, Uber Eats customers, merchant partners and delivery partners to the Grab platform. The Uber app will continue to operate for two weeks to ensure stability for Uber drivers, who can find out how to sign-up to drive with Grab online. Uber Eats will run until the end of May, after which Uber delivery and restaurant partners will move to the GrabFood platform.
A new era of growth
Grab will now focus on expanding its three main service verticals:
Grab will rapidly expand its existing GrabFood businesses in Indonesia and Thailand to two more countries, Singapore and Malaysia, following the integration of the Uber Eats business. GrabFood will be available across all major Southeast Asian countries in the first half of 2018.
The company will also grow its core transport offering to include more localised transport services and new mobility solutions. Grab will also collaborate with governments and public transport operators to link public transport services, the recently announced GrabCycle marketplace for shared bicycles and the upcoming GrabShuttle Plus for on-demand bus routes.
Payments and financial services
Grab will continue to enhance its suite of offerings under Grab Financial, including mobile payments, micro-financing, insurance for “millions of underserved and unbanked consumers, micro-entrepreneurs and small businesses in the region”. GrabPay as a mobile wallet will be available across most Southeast Asian countries by the end of the year.