Grab confirms mulling spin off of payments and financial units

Ride-hailing and payments major Grab is considering spinning off its payments and financial services businesses in a bid to operate the divisions independently, its executives confirmed to the Financial Times.

The company, the report said, may raise capital for the two business units separately with a view to spinning off one or both of them at a later date.

Anthony Tan, CEO of Grab, told Financial Times that the company has been approached by several financial and strategic investors.

“We see food as a big growth driver for us as well. We expect our food delivery business to be four times larger than any other player regionally by the end of the year,” Tan told the newspaper.

DEALSTREETASIA had earlier reported that Grab was in talks with Alibaba’s Ant Financial to raise funding for its financial services unit instead of the main holding company.

In March, TechCrunch had reported that Grab was considering spinning off its financial services unit and was in talks with US online payments company Paypal, along with Ant Financial, for the same.

If the spin-off is successful, it will mirror a similar development undertaken by Alibaba. The Chinese e-commerce behemoth spun out Alipay and Ant Financial, its payment and financial services arms, respectively, in 2014.

The confirmation to FT, along with a previous announcement about its plans to raise an additional $2 billion in funding this year, could be seen as the company flexing its muscles while competitor GOJEK seeks to close a $2-billion round.

Grab president Ming Maa has previously attributed the company’s expanding fundraising goal to “unlimited support” from Masayoshi Son and his SoftBank Vision Fund, which have pledged support for the Southeast Asian decacorn. Son is known to throw insane amounts of cash at startups to run their competitors to the ground.

Grab has been accumulating a raft of investors to its cap table of late, including names like Toyota Motor Corporation, Oppenheimer Funds, Hyundai Motor Group, Booking Holdings, Microsoft Corporation, Ping An Capital and Yamaha Motor.

Also Read:

Grab eyes Ant Financial funding in quest to dominate SEA’s financial services market

Grab to raise additional $2b in funding this year, SoftBank to top up

SG Digest: Grab in talks to spin off financial services unit; Alliance Healthcare eyes Catalist listing

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.