Grab lands $2b in fresh funds, raising coffers to $10.8b

In total, Grab has raised over US$8 billion (S$10.8 billion) since it was formed in June 2012. PHOTO: LIANHE ZAOBAO

Singapore-headquartered app giant Grab Holdings has secured US$1.46 billion (S$2 billion) of fresh funding from the SoftBank Vision Fund, a subsidiary of Japan's SoftBank.

It comes during the company's latest round of Series H funding, with investors such as Toyota Motor, Oppenheimer Funds, Hyundai Motor, Booking Holdings, Microsoft Corp, Ping An Capital and Yamaha Motor together contributing US$4.5 billion.

In total, Grab has raised over US$8 billion (S$10.8 billion) since it was formed in June 2012. Earlier investors included Honda Motor and Vertex Ventures, the venture arm of Singapore's investment company Temasek.

Mr Anthony Tan, Grab's co-founder and chief executive, said: "SoftBank and the Vision Fund are longstanding strategic investors and we are grateful for their continued support.

"The investment is a clear statement of belief in our vision to grow South-east Asia's technology ecosystem as the region's No 1 super app."

Grab's other co-founder, Ms Tan Hooi Ling, said yesterday that the company will make use of the investments to expand and diversify to serve the 138 million people across South-east Asia who have downloaded its app.

She added that new ventures being launched or expanded this year will include financial services, food delivery, parcel delivery, news content and digital payments.

Using Grab's open platform, GrabPlatform, services such as on-demand video, healthcare, insurance, and travel and hotel bookings will be offered "some time this year".

It is also entering the multibillion-dollar money remittance business.

Grab said it plans to invest "a significant portion of fresh proceeds" in Indonesia, where it is going head to head with home-grown app firm Gojek.

Grab claims it has 60 per cent of the two-wheel market and 70 per cent of the four-wheel market there.

GrabFood is now operating in 178 Indonesian cities, up from 13 at the start of last year.

It has also launched an indirect financing business there called Kitchen, where Grab will set up a new shop for a business that wants to expand but does not have the resources to do so. In return, the business will share its revenue with Grab.

In Singapore, Grab said it will expand its GrabShare service - where two or more commuters share a chauffeured car - to include bigger vehicles, ranging from six-seater compact minivans to 13-seater mini-buses. Ms Tan said this aims to fill gaps in the transport fare spectrum that ranges "from $1 to $15" per trip.

She said there are "pockets of profitability" within the group, such as transport in certain markets, but maintained that on the whole, Grab is still in the red.

"We're not aiming for profitability any time soon," she said, referring to the new businesses.

Neither is Grab aiming for an initial public offering to raise funds any time soon.

"We're in no shortage of funding," she said.

With more than US$8 billion to its name, Grab's valuation is larger than the average capitalisation of companies listed on the Singapore Exchange.

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A version of this article appeared in the print edition of The Straits Times on March 07, 2019, with the headline Grab lands $2b in fresh funds, raising coffers to $10.8b. Subscribe