Grab a seat, Uber purists. US ride-hailing company Uber is selling its Southeast Asian business to Grab, the companies announced today.
The deal puts Grab miles ahead of its regional competitors in the ride-hailing industry. The two companies did not disclose the deal’s price tag but said Uber will hold a 27.5% stake in its local rival under the agreement, and surrender all of its Southeast Asian operations, including its online food and delivery platform Uber Eats.
Competing platform GrabFood currently operates in Indonesia and Thailand, but the company plans to expand rapidly to Singapore and Malaysia before also becoming available across major Southeast Asian countries by mid-2018. Uber Eats will run until the end of May 2018, after which its partners will migrate to GrabFood.
Meanwhile, the Uber app will run as usual for the next two weeks to allow its existing drivers time to sign up with Grab if they choose. Customers to will also inevitably be directed to Grab.
Speculation about a consolidation in the ride-hailing industry began in January when Japan’s Softbank Group made a big investment in Uber. Softbank is also a big shareholder at Grab, India’s Ola and China’s Didi Chuxing – the latter bought over Uber’s operations in China in 2016. And just last year, Uber merged its business in Russia with Yandex.