After months of rumours swirling in the media, Southeast Asian ride-hailing giant Grab has officially announced the close of a US$2 billion round led by Chinese ride-hailing company Didi Chuxing (DiDi) and Japanese telecom conglomerate SoftBank Group.
The newly-raised financing will allow Grab to increase its market share and strengthen its mobile payments platform GrabPay.
Grab said that it plans to raise an additional US$500 million, but did not say when.
“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, in a press statement.
“Grab is using technology to address transportation and payments, some of the biggest challenges present in Southeast Asia, and we believe Grab is a tremendously exciting company in a dynamic and promising region,” said Masayoshi Son, Chairman and CEO of SoftBank Group Corp.
Launched in 2012, Grab started off as just a taxi-hailing platform. Today, it offers a wide range of transportation services, including motorbikes, coaches, private cars and shuttle buses.
Grab claimed that, regionally, it has a market share of 95 per cent in third-party taxi-hailing and 71 per cent in private vehicle hailing.
It added that it has a fleet of over 1.1 million drivers, who collectively conduct three million rides daily. Grab also claimed that GrabPay Credits — an e-wallet service — has grown 80 per cent month-on-month since its launch in December 2016.
Earlier this year, Grab announced its US$700 million plan for Indonesia. It was set in motion with the acquisition of Indonesian O2O e-commerce platform Kudo in April, followed by the establishment of an R&D centre in May. Grab will also launch a social impact investment fund.
The investment will help Grab fight its chief rival in the country — Go-Jek. Grab’s battle with Go-Jek is also partially fuelled by Chinese internet giants Alibaba and Tencent, who are leveraging their rivalry to wage a proxy war in the region.
Grab is backed by Alibaba while Go-Jek is supported by Tencent.
Image Credit: Grab