Uber is reportedly gearing up to sell its ridesharing business in Southeast Asia to Singapore-based Grab. In return, Uber would obtain a substantial stake in Grab, sources close to the potential deal told CNBC.
Still, Uber and Grab have not reached a deal as of the writing of this article. And it is not clear when, or if, the companies might do so. But, if the deal goes through, it would be in line with Uber’s previous moves.
Uber sold its ride-hailing business to Didi Chuxing, the leading carsharing company in China, in return for a 20 percent ownership stake in the company, for example. And, in Russia, Uber merged with Yandex’s ridesharing business to create a new company in which it would own a 36.6 percent ownership stake said to be worth almost $1.4 billion. The goal behind the deal is to help Uber cut its costs as it eyes an initial public offering (IPO), according to CNBC’s sources.
The news comes about a month after Grab inked a deal to acquire iKaaz, the mobile payment startup from India. According to news from TechCrunch at the time, the engineering team of iKaaz would migrate to Grab’s engineering office in Bangalore, which opened in 2017. Specific terms of the acquisition were not disclosed.
Overall, Grab is in growth mode, with a report surfacing this past summer stating that the company is looking to raise $1 billion in venture capital funding. Additionally, Alibaba Founder Jack Ma could potentially team up with SoftBank to jointly invest $1.5 billion in Grab through his eCommerce company or Ant Financial, the financial arm of the enterprise.
With the backing, investors were hoping the ridesharing company could better compete against Uber in Southeast Asia. Didi Chuxing is already an investor in Grab and was also mulling participating in the latest venture capital round.
Grab serves more than 100 cities with private car, motorbike, taxi and carpooling services. It leads in taxi-hailing in the region, with a 95 percent market share, according to the company.