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Uber has exited the Southeast Asian ride-hailing market with a sale to Singapore-based Grab, which also operates in Malaysia, Indonesia, the Philippines, Vietnam, Thailand, Myanmar, and Cambodia:
Uber is selling its South East Asia ride-share and food delivery businesses to regional rival Grab. The move marks a further retreat from international operations for Uber, after it sold its China business to local rival Didi Chuxing. Both firms describe the deal as a win for their passengers, but analysts warn it could mean higher prices.
Grab is South East Asia's most popular ride-sharing firm with millions of users across eight countries. Under the terms of the deal, Uber will take a 27.5% stake in Singapore-based Grab. Uber's chief executive, Dara Khosrowshahi, will also join Grab's board.
SoftBank is the biggest investor in both companies, and could also engineer an Uber exit from India, where it competes with Ola:
[...] real victory unquestionably belongs to Masayoshi Son's SoftBank Group Corp., the single-biggest investor in both companies. As I wrote earlier this month, by engineering a retreat for the U.S. company before any more bloodletting for market share, Son ensures that six-year-old Grab will emerge as an early champion in a winner-takes-all business.
A faster path to profit for Uber could also boost its valuation ahead of a planned IPO next year. But at what cost? Having already surrendered China to Didi Chuxing, beating a retreat from Southeast Asia is a precursor to perhaps losing India, the lone remaining jewel in Uber's once-flourishing Asian empire.
In India, once again, SoftBank is the largest investor in Uber's main rival, Ola. Competition between the two apps has become ridiculous. For all the PR gobbledygook on how happy Uber and Ola drivers are, the reality is that many who took out bank loans to acquire new cars are hurting badly. There's a glut of ride-hailing cars; wages have collapsed. Banks are collecting on "DUD," -- my moniker for "distressed Uber debt" -- by repossessing vehicles.
Uber's new CEO, Dara Khosrowshahi, says there will be no more exits from global markets (in addition to China, Uber also left Russia). But SoftBank may continue to pursue a strategy of exiting emerging and less profitable markets in exchange for large stakes in competitors.
Related: SoftBank's $80-100 Billion "Vision Fund" Takes Shape
SoftBank to Invest Billions in Uber
SoftBank Devalues Uber by 30% With Latest Offer
SoftBank Acquires 20% of Uber While Massively Devaluing It
(Score: 2) by c0lo on Monday March 26 2018, @10:50PM (4 children)
Uber squeezes the drivers, SoftBank squeezes Uber.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 3, Interesting) by takyon on Monday March 26 2018, @11:15PM (1 child)
https://www.bloomberg.com/news/articles/2018-03-26/grab-vanquishes-uber-with-local-strategy-billions-from-softbank [bloomberg.com]
SoftBank funds Uber and its competitor Grab, Uber gets a stake in Grab, SoftBank ends up with a stake in both and reduced competition in one region. The barrier to entry is presumably high for companies that aren't as big as Uber, so Grab gets to dominate. It's a good strategy. It could be bad for the drivers and passengers; that remains to be seen.
https://www.cnbc.com/2018/03/26/saudi-crown-prince-talks-investments-with-softbank-chief-in-new-york.html [cnbc.com]
SoftBank is making some big bets. They could pay off. And I doubt SoftBank will ever be a household name like Google or Facebook. They can do evil without much attention.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 0) by Anonymous Coward on Monday March 26 2018, @11:40PM
Wanna bet their bets won't benefit the drivers? I almost could feel the same for passengers, but I'll defer my guess - risk management reasons.
(Score: 2) by DannyB on Tuesday March 27 2018, @01:41PM (1 child)
Uber cannot win in a ball squeezing contest.
Uber needs to stop screwing around and refocus its efforts onto finding another self driving car technology to steal.
To transfer files: right-click on file, pick Copy. Unplug mouse, plug mouse into other computer. Right-click, paste.
(Score: 2) by c0lo on Tuesday March 27 2018, @02:24PM
Nothing that wrong with their current technology - look, Ebola killed more that one person so far, and yet they didn't eradicate it.
(large grin)
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford