Business

Grab to raise $3.4 billion to beat Uber

Ride-hailing service Grab expects to raise US$2.5 billion (S$3.4 billion) in a record round of fund-raising to cement its lead over Uber in the region and grow its payments platform.

South-east Asia has become a key battleground for technology start-ups vying for a market of more than 600 million people, with a burgeoning middle class and a youthful demographic.

Grab's Chinese peer Didi Chuxing and Japan's SoftBank Group, both of which are existing investors, will contribute up to US$2 billion to lead the current financing round, it said in a statement yesterday.

Grab expects to raise an additional US$500 million, bringing the total to US$2.5 billion in this round, which it said would be the largest-ever single financing in South-east Asia.

It will be valued at more than US$6 billion at the close of this round, according to a source close to the company.

The Singapore-based company said it has a South-east Asia market share of 95 per cent in third-party taxi-hailing and 71 per cent in private vehicle hailing. It operates private car, motorcycle, taxi and carpooling services across seven countries in the region.

"With (Didi and SoftBank's) support, Grab will achieve an unassailable market lead in ride-sharing, and build on this to make GrabPay the payment solution of choice for South-east Asia," Mr Anthony Tan, group chief executive officer and co-founder of Grab, said in the statement.

Building on soaring user numbers of its Grab ride-hailing app and GrabPay function, the five-year-old start-up aims to transform into a consumer technology firm that also offers loans, electronic money transfer and money-market funds.

Grab bought Indonesian payment service Kudo earlier this year, and has said it is seeking more acquisitions to support rapid growth. - REUTERS

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