Uber Officially Gives up Competition With Rival Grab in Southeast Asia
It's official. Uber is giving up on its operations in Southeast Asia, opting instead to sell off to its biggest competitor in the market, Grab.
The two ride-sharing companies had unofficially agreed to a deal earlier in March, and they both confirmed the details of the agreement Monday. In exchange for its operations and assets in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, Uber will get a 27.5% stake in Singapore-based Grab (a stake worth several billion dollars, according to Uber), and about 500 employees will transition to Grab as well. The deal also includes the food delivery venture UberEats, and it means that Uber CEO Dara Khosrowshahi will join Grab's board.
The deal, which Grab says is the largest ever of its kind in Southeast Asia, means the end of a costly effort by Uber to find a foothold in the region. The company invested about $700 million competing with the area's local startups. In February, Khosrowshahi noted he expected to lose money in the region as the company tried to compete, The Wall Street Journal reported. A 2017 report by the consultant firm Bain found that users in the region prefer Grab to Uber.
"One of the potential dangers of our global strategy is that we take on too many battles across too many fronts and with too many competitors," Khosrowshahi said Monday in an email to Uber staff. "This transaction now puts us in a position to compete with real focus and weight in the core markets where we operate, while giving us valuable and growing equity stakes in a number of big and important markets where we don't."
This is not Uber's first regional selloff. In 2016, the San Francisco-based ride-hailing company sold its operations in China to Didi Chuxing Technology Co., and it gained a 20% stake of the company in that deal. Uber also merged its Russian business with the region's Yandex.Taxi and acquired 37% of that firm.
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The Capital One Venture X Business Card has all the Capital One Venture X Rewards Credit Card has to offer and more. It offers an incredible welcome bonus and requires an equally impressive spend to qualify. In addition, the card comes with premium travel perks like annual travel credit. (Partner offer)Pros
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- Business owners are also able to add employee cards for free.
Cons
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- Another drawback is that the annual travel credit can only be used on bookings made through Capital One Business Travel.
- LIMITED-TIME OFFER: Earn up to 400K bonus miles: 200K miles when you spend $30K in the first 3 months, and an additional 200k miles when you spend $150k in the first 6 months
- Earn unlimited 2X miles on every purchase, everywhere—with no limits or category restrictions
- Earn 10X miles on hotels and rental cars and 5X miles on flights and vacation rentals booked through Capital One Business Travel
- With no preset spending limit, enjoy big purchasing power that adapts so you can spend more and earn more rewards
- Empower your teams to make business purchases while earning rewards on their transactions, with free employee and virtual cards. Plus, automatically sync your transaction data with your accounting software and pay your vendors with ease
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- Every year, you'll get 10,000 bonus miles after your account anniversary date. Plus, receive an annual $300 credit for bookings made through Capital One Business Travel
- Receive up to a $120 credit for Global Entry or TSA PreCheck®. Enjoy access to 1,300+ airport lounges worldwide, including Capital One Lounge locations and Priority Pass™ lounges, after enrollment
- Enjoy a $100 experience credit and other premium benefits with every hotel and vacation rental booked from the Premier Collection
- This is a pay-in-full card, so your balance is due in full every month