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SoftBank, Didi hand $2 bn to Uber's biggest Asian rival

The record financing follows Uber's retreat from Russia and China

Yoolim Lee | Bloomberg 

The Singapore-based ride-hailing company said on Monday it expects to close another $500-million fund from unspecified new and existing backers. Photo: reuters
The Singapore-based ride-hailing company said on Monday it expects to close another $500-million fund from unspecified new and existing backers. Photo: reuters

raised $2 billion from Chuxing and Group in the largest-ever venture fundraising in Southeast Asia, joining forces with two instrumental in driving Technologies out of
 
The deal cements an alliance between SoftBank, and Grab, which competes against in markets from Malaysia to Thailand. The Singapore-based ride-hailing company said on Monday it expects to close another $500 million from unspecified new and existing backers. That would take its valuation north of $6 billion, making it the most valuable start-up in Southeast Asia, a person familiar with the matter said.

 
The record financing follows Uber’s retreat from and China, massive markets where spent billions but ultimately capitulated to well-financed and savvy local rivals. In Southeast Asia, it’s waging a costly war against not just but also Go-Jek, which is holding its own on its home turf of Indonesia. The local players have thus far shown greater initiative in terms of launching services such as digital payments, said Ajay Sunder, vice-president of digital transformation at Frost & Sullivan in Singapore.
 
has been a lot more aggressive than Uber, making new acquisitions and launching new services in the region,” he said. “will have to make a call at some stage.”
 
has been the primary financier of the battle against in Asia, first putting $5 billion in alongside an early investment in and India’s Ola. The round is one of its largest investments in the region, coming on the heels of the establishment of its mega Vision Fund.
 
It’s a vote of confidence from a company that backed Alibaba Group’s battle in against first eBay and then Amazon.com. Grab’s relationship with the Japanese company has blossomed since co-founder Anthony Tan first met with Chairman Masayoshi Son at the billionaire’s Tokyo office in 2014. The two sealed a deal then with a handshake and has backed every funding round since.
 
is using technology to address transportation and payments, some of the biggest challenges present in Southeast Asia,” Son said in a statement.
 
Asia’s largest ride-hailing services are arming themselves for war with Uber, now that the cessation of activities in and allows it to focus on other fledgling markets around the world. Southeast Asia — a region on the cusp of an internet commerce boom with twice as many people as the US — remains a wide-open field that could prove pivotal if is to sustain growth beyond the US and Europe.
 
When it closes, the current investment in will eclipse a previous regional record of $750 million set in September, in a round said to have given it a valuation of more than $3 billion. Go-Jek, better known for its motorcycle taxis, raised $550 million in a 2016 round led by KKR & Co and Warburg Pincus. On Monday however, said it has 95 per cent of third-party taxi-hailing in Southeast Asia and handles 71 per cent of private vehicle-hailing, and has almost three million daily rides.
 
may be preparing for an initial public offering (IPO), possibly within a year, said Frost & Sullivan’s Sunder. “When you have your existing, anchor investors putting in a larger share like this, that’s typically a way to fund the last investment stage before the IPO,’’ he said. 

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