SINGAPORE: Grab Merges With Uber In Southeast Asia, Uber To Hold 27.5% Stake

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.

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.

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.

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.



Tourism Observer

USA: Dara Khosrowshahi Is New Uber CEO

Dara Khosrowshahi New Uber CEO
Uber Technologies Inc chose Dara Khosrowshahi, the chief executive of travel company Expedia Inc, as its chief executive on Sunday, according to two sources with knowledge of the matter, handing him the challenge of leading the ride-services company out of a nearly year-long crisis.

Khosrowshahi, 48, would take on the daunting task of mending Uber’s image, repairing frayed relations among investors, rebuilding employee morale and creating a profitable business after seven years of losses.

In Khosrowshahi, Uber’s board has picked an executive with a track record of driving growth while also delivering profits - precisely what the unprofitable Uber needs to satisfy investors.

He has also proven capable of making Expedia the leader in another industry full of change and competition - online travel.

But he would also have to contend with the legacy of Travis Kalanick, Uber’s pugnacious co-founder, who was ousted as CEO in June after shareholders representing about 40 per cent of the company’s voting power signed a letter asking him to step down amid growing concern over his behaviour and that of senior managers under him.

The Uber board of directors has been meeting daily and deliberated on its pick for CEO throughout the weekend. A spokeswoman said on Sunday that the board had voted but was declining to disclose its choice publicly until after informing employees.

An Uber spokesman and an Expedia spokeswoman declined to comment. Khosrowshahi did not immediately respond to requests for comment through email and on Twitter.

Khosrowshahi, who has run Expedia for 12 years, was not known to the public to be among the top candidates for the job.

He beat out Jeff Immelt, chairman of General Electric Co and one of the finalists for the job, who said earlier on Sunday he was no longer in the running.

Meg Whitman, chief executive of Hewlett Packard Enterprise, had also been a leading candidate, according to sources close to the process. Whitman last month denied having any interest in the job.

Unlike Immelt and Whitman, Khosrowshahi is not a fixture in the celebrity executive community. And since Expedia is based in Bellevue, Washington, he is a Silicon Valley outsider.

The Iranian-American businessman came to the United States as a child in 1978 with his parents following the Iranian Revolution. He received a bachelor’s degree in engineering from Brown University and got his start at investment bank Allen and Co.

Khosrowshahi has certainly done well for himself - in 2015 he was the highest paid CEO in the country, mainly because of a nearly US$91 million stock option grant. He is also on the board of the New York Times Company and sports merchandise company Fanatics Inc.

Under Khosrowshahi’s leadership, Expedia more than doubled its annual revenue since 2012 to nearly US$8.8 billion in 2016. The company reported net income of US$281.8 million for 2016.

In an interview with CNBC in May, he said: Analysts are focused on margins. I am focused on growth.

He led Expedia through a string of acquisitions since 2014, buying Airbnb rival HomeAway Inc for US$3.9 billion, Orbitz Worldwide Inc for US$1.3 billion and Travelocity for US$280 million, cobbling together an online travel empire. Expedia is the world’s largest online travel agency by bookings.

He has been an outspoken critic of US President Donald Trump, blasting Trump’s travel ban, which includes Iran, as inward-looking and reactionary. Expedia filed a legal challenge to the ban.

At Uber, he would bring an end to a company culture built on founder control. Kalanick enjoyed sweeping authority on the board and nearly complete autonomy in running the company, a governance style that helped to create a workplace that had few checks and balances.

Uber has been hit by allegations of sexual harassment, a lawsuit alleging trade-secrets theft, a federal criminal probe over use of software to evade city regulators, and allegations of executives mishandling the medical records of a victim who was raped by her Uber driver in India, among other controversies.

Uber was valued at US$68 billion at its most recent investment last year, but recently some mutual funds have written down the value of their Uber investment by as much as 15 per cent, a sign of wavering confidence in the company.

Despite the controversies, Uber is still a growing company.

Last week, the company reported a 16 per cent increase in ride bookings and a 17 per cent jump in net revenue for the second quarter over the previous period, and its losses shrank by 9 per cent.



Tourism Observer