Alibaba Weighs Investment in Grab

The Chinese e-commerce giant is in talks with Singapore-based ride-hailing and payments firm Grab over a potential $3 billion investment into the company.

Part of the funds will be used to purchase Grab stock held by Uber, which acquired 23.2 percent of the company when it exited Southeast Asia in 2018, as reported on Monday, citing people related to the matter.

Alibaba’s potential tie-up with Grab gives it access to data on millions of users in eight countries, a growing delivery fleet as well as a stake in a digital wallet and financial services noted.

The news comes just a day after Grab had resumed merger talks with Jakarta-headquartered rival Gojek, at the urging of shareholders including SoftBank. The two companies are facing large losses due to Covid-19 related restrictions – Grab already laid off 5 percent of its workforce in June, which founder and CEO Anthony Tan said would help it better face the challenges of a post-Covid economy.

Grab was valued at $14 billion in its last funding round in 2019, when it raised $1.5 billion from SoftBank’s Vision Fund. However, «FT» noted, citing secondary market brokers, that Grab shares have been trading at a 25-percent discount, while shares in Gojek, valued at close to $10 billion last year, have also been selling at steep discounts, particularly from early shareholders wanting to exit.

Grab rolled out a new strategy in August to expand its consumer services ecosystem, with new products including a micro-investment solution, a third-party loan platform, and a buy-now-pay-later service.

The firm has partnered Singtel in its application for a digital bank license in Singapore. It also moved into wealth management with the acquisition of Singapore-based robo-advisor Bento, which was relaunched as GrabInvest.