Transport and engineering group Goldbell said yesterday that it expects its acquisition of electric car-sharing outfit BlueSG to be completed by August - a deal first reported by The Straits Times on Monday.
The homegrown group said it will invest $70 million over the next five years to help turn the loss-making car-sharing business around. Part of the sum will go into research and development.
It declined to reveal the acquisition sum, but sources said BlueSG's fleet of about 650 subcompact vehicles would cost $20 million to $25 million, and that the sale and purchase agreement includes the value of the operator's 100,000-strong subscriber base.
Goldbell will also have access to 250 new cars that BlueSG has not yet added to its operating fleet.
Goldbell Group chief executive Arthur Chua said he expects the acquisition to yield return on investments in four to six years, when usage per car per day is expected to rise to "between nine and 10". Currently, the usage ranges between five and six.
The CEO emphasised that this projection is without government grants, which BlueSG has had since it started operations in 2017.
He said Goldbell has algorithms to help in "fleet rebalancing", which means it will move cars to places where it expects the highest demand to be. He noted that this will be a key difference in realising the full potential of the business. A small percentage of the cars will also be on a "free float", which allows users to park them almost anywhere they wish after their rental.
Mr Chua said Goldbell will inject new vehicle models into the fleet, as well as introduce van-sharing.
"We are extremely confident of this new business," he told The Straits Times, explaining that the "wide gap" between public transport and taxi or private-hire fares makes car-sharing feasible.
He added that the acquisition "fits into our vision of future commuting patterns" arising from more people working and playing nearer to where they live.
"It also fits into my personal belief that electric vehicles are better for the environment, and they are here to stay."
He said he intends to eventually take the business to new markets in the region.
The fleet will continue to have access to the current 1,500 charging points, which will remain under BlueSG parent Bollore's ownership. However, Mr Chua said he is "looking forward to partnering with other infrastructural providers" to expand the network.
Goldbell is a 41-year-old company specialising in distributing and leasing commercial vehicles. In recent years, it embarked on what it calls "disruptive growth", by starting a series of new-tech ventures, including on-demand bus services, a digital investment platform and intelligent warehousing.
BlueSG remains uncontactable for comments.
