Didi Chuxing, SoftBank To Invest $2 Bln In Uber Rival Grab

A woman uses her phone near a sign for the online ride-hailing service Grab at the Manggarai train station in Jakarta Indonesia

Tan is confident that the support from DiDi and SoftBank will help Grab become the market leader in the ride-sharing industry, and build Grabpay into becoming the main payment solution in the region.

Ride-hailing company Grab on Monday (Jul 24) announced up to US$2 billion (S$2.7 billion) will be raised from China's Didi Chuxing and Japan's SoftBank in its latest financing round.

Investors in Grab's previous fundraising include sovereign wealth fund China Investment Corp, hedge fund Coatue Management LLC, venture capital firm GGV Capital, and Vertex Ventures Holdings - a subsidiary of Singapore state investor Temasek Holdings (Pte) Ltd.

The company claims a 95 percent market share in third-party taxi hailing and 71 percent market share in private vehicle hailing in Southeast Asia.

Didi, also backed by SoftBank, is itself is part of a breed of Chinese tech giants hungry for growth overseas.

The new money will go toward cementing Grab's leading position in Southeast Asia and developing its proprietary mobile payment platform, called GrabPay. The bank also backed Grab's bid to raise at least $750 million in September to become the largest auto and motorbike hailing company in the region of Southeast Asia.

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The record financing follows Uber's retreat from Russian Federation and China, massive markets where Uber spent billions but ultimately capitulated to well-financed and savvy local rivals. The ride-hailing app swallowed its rival, Uber China, a year ago and now dominates its home market.

"By deepening our strategic partnership, DiDi and Grab reaffirm our shared commitment to innovating localised solutions to global urban development challenges from the world's fastest growing marketplaces", said Cheng Wei, Founder and CEO of DiDi Chuxing.

Grab, which operates private auto, taxi, carpool, and motorcycle bookings across seven countries in the region, is aiming to challenge its competitor Uber. "SoftBank is excited to deepen this partnership and we look forward to continuing to support Grab's journey", said SoftBank Group Corp Chairman and CEO Masayoshi Son.

The news could hurt Uber's expansion in the region, as it's already failing to make much of an impact around Asia.

This means a whole lot of focus on the Indonesian market, with investments and acquisitions to facilitate ease in use of service, with offline payment start-up Kudo among their buys.

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